IJGlobal Awards 2019 Europe & Africa

Europe & Africa

It is with great pleasure – but sadly not Winners in the European transaction ‡ Social Infrastructure – Irish Social in the splendour of London’s Natural category are: Housing Bundle 1 History Museum – that we announce ‡ Battery Storage – Yorkshire Solar ‡ Telecoms – EllaLink Subsea Cable IJGlobal's winners for European and and Battery Hybrid ‡ Transport – Silvertown Tunnel African awards for company activity and ‡ Oil & Gas – .HOODV5HÀQDQFLQJ transactions closed over calendar year ‡ Restructuring – Irish Schools 2019. ‡ Innovation – Allego Bundle 5 Sadly, due to the coronavirus ‡ Ports – Gdansk Port pandemic, we were forced to cancel ‡ 5HÀQDQFLQJ² Beatrice offshore Winners in the African transaction the March dinner and ceremony in wind category are: the spiritual home of IJGlobal Award ‡ Waste – Belgrade Energy from ‡ Mining – Guinea Alumina Project Nights, under the watchful gaze of Waste dinosaurs from the industry and pre- ‡ Oil & Gas – Gimi Floating LNG history alike. ‡ 3RUWIROLR5HÀQDQFLQJ² Project ‡ Transport – New Owendo Winners in the institutional category .HDQH5HÀQDQFLQJ International Port PPP ZHUHYRWHGRQE\VHQLRUÀJXUHVIURP ‡ Utility – Elenia Heat ‡ 5HÀQDQFLQJ Societe Ivorienne de across the regional infrastructure and ‡ Power – Neart Na Gaoithe 5DIÀQDJH energy community – none allowed to ‡ ESG Finance Innovation – Soma 4 ‡ Power – Bridge Power vote in their own business areas – in Project what is widely regarded to be the most ‡ Renewables – Kahone and Toube independently-judged awards in this ‡ Renewables Acquisition – Kisielice Solar sector. onshore

Summer 2020 www. ijglobal.com 50 IJGlobal Awards 2019 Europe & Africa

European Battery Storage European Oil & Gas European Innovation Yorkshire Solar and Battery .HOODV0LGVWUHDP5HÀQDQFLQJ Allego Hybrid In the months leading up to Antin In May 2018, Meridiam announced the The Hybrid solar farms in Yorkshire and Hull Infrastructure Partners’ sale of the Kellas acquisition – fully funded with equity – of DUHWKHÀUVWRIWKHLUNLQGLQWKH8.EXLOW midstream assets, the sponsors hired 100% shares in EV charging provider without any reliance on subsidies which are Natixis as mandated lead arranger and Allego from Alliander through the Meridiam the life blood for most clean energy projects ERRNUXQQHUWRUHÀQDQFHWKHDVVHWVRI Transition Fund. Meridiam mandated around the world. strategic geopolitical importance. 6RFLHWH*HQHUDOHWRVWUXFWXUHWKHÀQDQFLQJ The solar farm in York uses 90,000 Kellas Midstream business consists of the of a general-purpose facility to fund its Suntech bifacial panels which facilitate Central Area Transmission System (CATS), development and geographic expansion in energy production from both sides of Esmond Transportation System (ETS) and Europe. the panel to generate 34.7MWp using a WKHJUHHQÀHOGFRQVWUXFWLRQSURMHFW+XPEHU 27MW battery, in what is being called a Gathering System – which transport gas “pioneering” model for the commercial from the North Sea to the UK. production of solar energy in the country. 7KHUHÀQDQFLQJRQO\LPSDFWHG&$76DQG Bifacial technology uses light bounce, ETS with the Humber Gathering System also known as Albedo, to produce energy VLWWLQJRXWVLGHWKHÀQDQFLQJ from the underside of the solar panel, 7KHÀQDQFLQJVWUXFWXUHZDVXQGHUSLQQHG maximising energy production without by the pipeline’s over-performing past, increasing costs. LWVFRQQHFWLRQWRODUJHJDVÀHOGVDQGLWV The Hull project is modelled around exploitation by key oil majors and integrated Allego rolls out, operates and provides WKHVDPHWHFKQRORJ\DQGÀQDQFLQJDQG utilities. services linked to EV charging stations and enabling the local Warrington Borough associated digital solutions. It has more than &RXQFLOWREHWKHÀUVWLQWKH8.WRSURGXFH 10,000 charge points installed in Europe all its own electricity from green sources. (enjoying market leading positions in the Sustainable energy technology developer, Netherlands and Germany). Gridserve, and Warrington Council closed With electric vehicle uptake expected to WKHSURMHFWÀQDQFLQJRQERWKWKHIDUPVZLWK increase exponentially in the next decade – a combined capacity of 62MW, supported in 2030, one in three car sales is expected by the 27MW storage facility. to be EV-based according to one estimate – Gridserve prides itself on building Allego will need to invest heavily in R&D and “intelligent energy storage” which allows ,QWKHUHÀQDQFLQJ1DWL[LVZDVVXSSRUWHG ,7H[SHQVHV7KHDPRXQWWREHÀQDQFHGLQ it to shift energy to a time when it is more E\ÀYHRWKHUOHQGHUVRQWKH PLOOLRQ WKHQH[WÀYH\HDUVLVURXJKO\½PLOOLRQ valuable and providing grid services around ($852 million) underwrite: RBC Capital Lenders Kommunalkredit and Societe the clock. Markets, Lloyds Banking Group, ABN Amro, Generale proposed a tailor-made structure Scotiabank, Santander. suited to Allego’s needs, with strong Then an additional 10 banks joined covenants to monitor the sustainable It is wonderful to be the syndication process: AIB, Banca IMI, growth of the company. It provided a €150 recognised for being a part of Barclays, BBVA, BMO, BNP Paribas, CBA, million debt facility (including a €30 million DSURMHFWWKDWLVWKHÀUVWRILWV CIC, Crédit Agricole, NatWest. accordion), with a seven-year maturity and 7KHWHQRURIWKHQHZGHEWLVÀYH\HDUV DQDYDLODELOLW\SHULRGRIÀYH\HDUVFDVK kind in the UK. and the pricing was rumoured to start at VZHHSVDQGDEXOOHWUHSD\PHQWSURÀOH Libor +150bp, rising to 165bp, 175bp, 7KHGHEWLVDVHQLRUÀQDQFLQJRI$OOHJR The batteries are being provided by the 200bp and 245bp. without recourse to Meridiam and includes Chinese technology company Sungrow The transaction included a £40 million an extensive security package and strong which is a subsidiary of Samsung. Gridserve revolver and a £250 million uncommitted covenants to monitor the growth of the KDVVDLGWKDWSURFXULQJÀQDQFHIRUWKHÀUVW accordion facility. ERUURZHULWVSURÀWDELOLW\DQGGHEWVL]LQJ farm in York was challenging as banks were 7KHVXFFHVVIXOUHÀQDQFLQJVDZEDQNV A joint syndication targeting both hesitant to invest in new technology but its FRPSHWHWROHQGRQWKHUHÀQDQFLQJRIGHEW investors and banks attracted experienced HIÀFLHQF\DQGSURÀWDELOLW\PDGHIXQGLQJWKH on Kellas’ operational assets, later leading players including Edmond de Rothschild IDUPLQ+XOOLQÀQLWHO\HDVLHU to a competitive auction process which saw via its BRIDGE platform, La Banque Postale Following the successful implementation Singapore sovereign-wealth fund GIC and Asset Management and SCOR Investment of the two projects, Gridserve claims it has Blackrock acquire the asset for around £1.5 Partners. a “grand pipeline” of projects within the UK billion a year later. 7KHDUUDQJHPHQWPDUNVWKHÀUVWRIDNLQG including a 100MW farm across four sites. The CATS pipeline is a 404km subsea ÀQDQFLQJLQDQLQIUDVWUXFWXUHDVVHWFODVVRI &KLHILQYHVWPHQWRIÀFHURI*ULGVHUYH SLSHOLQHFRQQHFWLQJSURGXFLQJÀHOGV the future with a borrower whose strategy Mark Henderson, said: “It is wonderful to be IURPDÀ[HGRIIVKRUHULVHUSODWIRUPLQ allows it to strongly mitigate the ramp-up risk recognised for being a part of a project that the central North Sea to an onshore gas related to the transition to EV mass market. LVWKHÀUVWRILWVNLQGLQWKH8.7KHPRGHO processing terminal in Teeside, on the north The 2026 horizon for debt maturity should we used has the potential to be the road east coast of England. ETS is a 165km long give enough comfort regarding the EV map for other solar energy farms as we subsea pipeline in the Southern North Sea market take-off and Allego’s strengthened proved that such projects can be executed FRQQHFWLQJSURGXFLQJÀHOGVWRWKH%DFWRQ SRVLWLRQWRHQYLVDJHUHÀQDQFLQJWKHDPRXQW without reliance on public grants.” gas terminal. outstanding.

Summer 2020 www. ijglobal.com 51 IJGlobal Awards 2019 Europe & Africa

European ports Gdansk Deep Sea Container Terminal

Gdansk Deep Sea Container Terminal (DCT) is one of the terminals within the Port of Gdansk and is located on the southern coast of the Baltic Sea. It is the country’s only deep-water container terminal able to receive ultra large container vessels and handled volumes of 1.9 million TEUs in 2018. The company – located strategically to serve as a major gateway into Poland and Central-Eastern European markets – was at the end of May last year (2019) acquired by a consortium of IFM Investors, Singapore- based port operator PSA International and the state-owned Polish Development Fund (PFR). For the transaction, the enterprise package of €382.5 million which comprised They acquired 100% of the container valuation for the asset was €1.3 billion and a €300 million acquisition term loan to terminal from Macquarie, which sold its 64% EBITDA multiple was 17.6x. UHÀQDQFHH[LVWLQJGHEWDQGÀQDQFHWKH stake from Macquarie Infrastructure and The new owners intend to further acquisition, a €70 million expansion capex Real Assets’ Global Infrastructure Fund II, strengthen DCT Gdansk’s position and to facility, and a €12.5 million revolving credit and Australian superannuation funds Motor look into additional expansion needs as and IDFLOLW\$OOWKHORDQVKDYHDÀYH\HDUWHQRU Trades Association of Australia Super (18%), when relevant. 8%6DFWHGDVWKHÀQDQFLDODGYLVHUWRWKH Australian Super (9%), and Statewide Super A group of eight lenders and lead buyers, while advisers to Macquarie were (9%). arrangers including BNP Paribas, BGK, Bank Goldman Sachs, Clifford Chance, EY, Moffatt PSA International now owns a 40% stake Pekao, CIBC, EBRD, PKO, PZU, and Societe & Nichol and Environmental Resources in the asset, while IFM Investors and Polish *HQHUDOHSURYLGHGDFTXLVLWLRQÀQDQFLQJ Management. White & Case advised the Development Fund own 30% each. for the asset. The banks provided a debt lenders on the transaction.

(XURSHDQUHÀQDQFLQJ²Beatrice Offshore Wind

With a strike price at £140 per MWh over a 15-year contract, the 588MW Beatrice Offshore Wind Farm proved a highly attractive project for lenders, allowing its sponsors to slash debt pricing via a UHÀQDQFLQJDQGUHOHDVH PLOOLRQ  million) in equity. Financial close on the £1.96 billion ELOOLRQ UHÀZKLFKZDVKHDYLO\ oversubscribed, occurred on 9 July 2019. Pricing on the new debt starts at 130bp above libor, with a step up to 145bp after the ÀUVWÀYH\HDUVDQGWKHQRQHÀQDOVWHSXSWR 160bp after 10 years. The SSE-led sponsor group was originally aiming for 125bp, and sources in the market had predicted it could be as low as 120bp in the run up to close. Total debt on the project was increased to £2.45 billion during negotiations, allowing the sponsor consortium to change the gearing from 81.6:18.4 in the an institutional investor tranche. Lenders as construction completed (May 2019). SULPDU\ÀQDQFLQJWRDURXQGLQWKH RQWKHUHÀLQFOXGHG$,%%DQNRI&KLQD The tenor of the debt, which signed in UHÀQDQFLQJUHOHDVLQJDURXQG PLOOLRQLQ BNP Paribas, CaixaBank, Credit Agricole, ZDV\HDUV7KHSULPDU\ÀQDQFLQJ equity to the owners. HSBC, ICBC, LBBW, KDB, KEB Hana Bank, UHDFKHGÀQDQFLDOFORVHRQ0D\ Ticket sizes varied between lenders, with Lloyds, Mizuho, MUFG, Norinchukin Bank, Located 13km off the Caithness coast some commitments scaled back. There SMBC, Santander, SMTB, Societe Generale, in Scotland the project is the fourth largest were 29 lenders in total on the deal and 24 Siemens Bank. offshore wind farm in the country. The hedging banks. Most of the debt came from Pricing on the original debt came in development site covers an area of around commercial banks though there was also at 200bp-210bp, stepping up as soon 131.5 square kilometres.

Summer 2020 www. ijglobal.com 52 IJGlobal Awards 2019 Europe & Africa

European waste Belgrade Energy from waste project

In October last year (2019), Suez, Itochu $QRQUHFRXUVHÀQDQFLQJRI½PLOOLRQ and Marguerite brought a landmark waste- included an A-loan of €72.25 million with WRHQHUJ\ :W( 333SURMHFWWRÀQDQFLDO an 18-year tenor from EBRD and IFC close in Serbia’s capital city. each, a B-loan amounting to €70 million Beo Cista Energija (BCE), the project with a 15-year tenor from UniCredit and SPV, is responsible for shutting down one Erste Bank, and a €35 million loan from of Europe’s largest open dumpsites still Oesterreichische Entwicklungsbank (OeEB). active and replacing it with EU-compliant The debt also comprised concessional VDQLWDU\ODQGÀOODQGZDVWHGLVSRVDOIDFLOLWLHV funding of €21 million from Taiwan which will process about 700,000 tons of GHEWÀQDQFLQJDORQJVLGHJXDUDQWHHVIURP International Cooperation Development municipal solid waste, construction and the Multilateral Investment Guarantee Fund (ICDF) and €20 million from Canada- demolition waste annually. Agency (MIGA) to make the project IFC Blended Climate Finance Program. $VRQHRIWKHÀUVWODUJHVFDOH:W( bankable. The IFC was the lead adviser to the City SURMHFWVÀQDQFHGSULYDWHO\LQWKH%DONDQV The sponsors used an equity bridge loan of Belgrade, and was in turn advised by the Belgrade WtE project serves as a of about €90 million provided by Raiffeisen Hogan Lovells, Karanovic & Partners and SDWKÀQGHUIRURWKHUFLWLHVLQWKHUHJLRQWKDW Bank International and UniCredit. Fichtner on the project. Advisers to sponsors are faced with similar waste challenges. MIGA provided guarantees of €97.3 included UniCredit, Baker McKenzie, Wolf The project featured innovative risk million for up to 20 years against non- Theiss, KPMG, and Herbert Smith Freehills. allocation to deal with the challenges of commercial risks. The guarantees cover Meanwhile, the lenders were advised by implementing a complex project in an up to 90% of investor equity in the project Clifford Chance, BDK Advokati, Arup, PwC emerging market and involved non-recourse company. and White & Case.

CLOSING BELGRADE’S WASTE DUMP, PROTECTING THE DANUBE, TURNING WASTE INTO RESOURCE

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SUEZ www.suez.com/en | ITOCHU www.itochu.co.jp/en | MARGUERITE www.marguerite.com | %(2Î,67$(1(5*,-$ www.bcenergy.rs

Summer 2020 www. ijglobal.com 53 IJGlobal Awards 2019 Europe & Africa

(XURSHDQSRUWIROLR5HÀQDQFLQJ European Utility European power 3URMHFW.HDQH5HÀQDQFLQJ Elenia Heat Neart Na Gaoithe

1HZChina, Barclays, BNP The debt, including associated swaps, Paribas, CaixaBank, CIC, Credit Agricole, EHDUVDÀ[HGLQWHUHVWUDWHRIDQG Commerzbank, DZ Bank, Helaba, ING, matures in December 2032. KfW IPEX-Bank, LBBW, Lloyds, Mizuho, The key challenges faced in the process MUFG Bank, NatWest, Norinchukin, OCBC, were integrating older merchant assets (up Santander, SEB, Shinsei, Siemens Bank, to 11 years old) with newer REFIT projects SMBC, Societe Generale. (less than one year old), determining the Pricing on the senior debt starts at 130bp appropriate technical asset life of a wind above Libor, stepping up to 140bp. It has a farm, and managing the new market risks tenor of 15 years plus construction, and the in the Irish market (ISEM process) as wind debt package has a debt cover service ratio EHFDPHEDODQFHUHVSRQVLEOHIRUWKHÀUVW (DSCR) of 1.4x. time. ESB acquired its 50% stake with equity To realise the target debt level and Each bank lent €46.7 million towards provided by the Government of Ireland. The SUHIHUUHGÀQDQFLQJWHUPVOHQGHUVDQG the acquisition and the debt packages deal has yet to close but it is understood their advisers needed to understand and comprised a €210 million acquisition term that ESB paid a high premium – around half accept a number of new approaches loan, a €15 million working capital facility the price of the entire project costs. to the challenges faced as the onshore and a €55 million revolving credit facility. Offshore construction will start in June wind industry evolves to a subsidy-free 7KHGHEWKDVDÀYH\HDUWHQRUDQGZDV 2020 and full commissioning will be investment world. lent at margins of Euribor +175-250bp. completed in 2023.

Summer 2020 www. ijglobal.com 54 IJGlobal Awards 2019 Europe & Africa

European ESG Finance Innovation European renewables Acquisition European Social Infrastructure Soma 4 Project Kisielice onshore Irish Social Housing Bundle 1

Garanti BBVA signed up to lend $44 million Green Investment Group (GIG) acquired the %XQGOHRQHRI,UHODQG VÀUVWVRFLDOKRXVLQJ in the form of a “gender equality loan” to 42MW Kisielice Polish wind farm in August PPP project came at a time of mounting Polat Energy to construct a 48MW extension 2019 from Impax Asset Management’s pressure on the housing market, with a to the operational 240.1MW Soma wind renewable energy fund Impax New Energy shortage of housing supply, increased farm in Turkey. Investors II – marking the Macquarie owned demand for home ownership and cases The loan consists of two portions – $21.5 LQYHVWPHQWÀUP·VÀUVWLQYHVWPHQWLQ3RODQG of half-built properties dotted across the million cash tranche with an eight-year tenor The project has been fully operational country. and a $22.6 million non-cash tranche with since 2014 and consists of 21x Enercon The project – part of a €300 million an 11.5-year tenor. E82 turbines. It is located in Warmiab, ($337 million) three-part programme which The gender equality loan adds several Masurian Voivodeship. GIG bought in its entirety aims to develop 1,500 new contingencies requiring Polat Enegry to the Kisielice onshore wind farm using homes and upgrade around 700 existing annually assess its performance in gender equity with no debt raised to support the properties across the country – also equality across its value chain. Criteria DFTXLVLWLRQDQGUHÀQDQFHGWKHSURMHFW PDUNVDVLJQLÀFDQWPLOHVWRQHIRU,ULVK include in the assessment are postnatal ÀQDQFHGHEWRQWKHDVVHWWRFORVHWKHGHDO infrastructure procurement as it opens up a return-to-work programs, equality in new new important avenue for delivering social recruitment, equal pay and policies to housing schemes. prevent harassment. Onshore wind is Poland’s Improvements will translate into better largest renewable energy terms on the loan. With better gender equality KPIs achieved the interest rate for source. the cash portion will be lowered, while the commission for the non-cash portion will be GIG also had to put in place a new reduced. contractual off-take framework by the Located across the Soma district of closing date with a new power purchase Manisa Province in west Turkey, the existing DJUHHPHQW 33$ JUHHQFHUWLÀFDWHV Soma wind complex consists of three purchase agreements and the agreement phases; the 79.2MW Soma 1, the 60.9MW for the sale of guarantees of origin. Comhar Housing, comprising equity Soma 2 and the 100MW Soma 3. Shortly following the signing of the provider Macquarie Capital, contractor Soma 1 consists of 89x Enercon E44/900 acquisition, Signify signed to offtake the John Sisk & Son, and FM company Choice turbines with a combined estimated annual energy from the wind farm through a 10- Housing and tenancy management production of 200GWh. This initial phase year virtual power purchase agreement company Oaklee Housing, will design, build, UHDFKHGÀQDQFLDOFORVHLQ'HFHPEHU 933$ ²PDNLQJ.LVHOLFHRQHRIWKHÀUVW ÀQDQFHRSHUDWHDQGPDLQWDLQVL[VRFLDO Soma 2 features 30x Enercon E70/2000 wind farms in a Central Eastern European housing sites across the Louth, Dublin, turbines and has an estimated annual country to have a long-term VPPA. Kildare and Wicklow counties. production of 150GWh. This second phase GIG also chose Wpd Windmanager to 7KHFRQVRUWLXPUHDFKHGÀQDQFLDOFORVH UHDFKHGÀQDQFLDOFORVHLQ provide O&M services to the wind farm. on the project on 19 March (2019), signing Soma 3 comprises 50x Enercon turbines, The acquisition also led to GIG’s second RQ½PLOOLRQLQGHEWÀQDQFLQJIURPWKH each with a capacity of 2MW, and reached investment in Poland in November (2019), European Investment Bank (EIB) and two ÀQDQFLDOFORVHLQ after it aquired the Zajaczkowo wind farm commercial lenders. Garanti BBVA has provided debt for all from J-Power and Mitsui. (,%SURYLGHGKDOIRIWKHGHEWÀQDQFLQJ four phases of the wind complex. Extensive W&I insurance was taken out having voiced its support for the scheme :RPHQLQ7XUNH\IDFHVLJQLÀFDQW by GIG to acquire the shares of the wind back in March 2017. disparities in employment and in some farm. Allen & Overy acted as legal adviser Bank of Ireland provided a debt of €36 UHJLRQVWKLVLVDOVRUHÁHFWHGLQWKHUHDOPV to Macquarie and K2 Management handled million and Korea Development Bank of education. The participation of Turkish technical advisory on the acquisition. provided €26 million. The tenor of the debt women in the labor force is less than half Poland is heavily dependent on an is 25 years, matching the length of the of that of the European Union average. DJLQJÁHHWRIFRDODQGOLJQLWHSODQWVDQG concession. Meanwhile, Macquarie provided has launched onshore wind auctions to 10-15% of the overall funding to the project meet 2.5GW of its electricity needs from in equity. renewables. Onshore wind is Poland’s Apart from Macquarie Capital as the Gender Equality Loan: $44 million largest renewable energy source with FRQVRUWLXP·VÀQDQFLDODGYLVHU0F&DQQ MLA: BBVA 5.7GW of installed capacity. Fitzgerald and Arcadis provided legal and technical advice to Comhar consortium. Tranches: $21.5 million cash tranche Ashurst acted as legal adviser to the Advisers: Allen & Overy, K2 and $22.6 million non-cash tranche lenders. Management Advisers to the Irish government were Tenor: eight-year tenor for cash tranche and 11.5-year tenor for non- VPPA length: 10 years NDFA, Eversheds Sutherland, Willis Risk cash tranche Services, HRA Planning, Simon J Kelly Offtaker: Signify Architects, Hayes Higgins Partnership, Matt Size of extension: 48MW Size of farm: 42MW O’Mahony & Associates, ORS and Currie & Brown.

Summer 2020 www. ijglobal.com 55 IJGlobal Awards 2019 Europe & Africa

European telecoms European transport European restructuring EllaLink Subsea Cable Silvertown Tunnel Irish Schools Bundle 5

The EllaLink Europe-Latin America 8.·V6LOYHUWRZQ7XQQHOLVWKHÀUVWPDMRU When Carillion collapsed, the Irish Schools VXEPDULQHFDEOHSURMHFWZDVÀUVWFRQFHLYHG transport investment in East London in the Bundle 5 PPP, in which the defunct in 2012 by pan-European and Latin last 30 years. The tunnel will serve as a river contractor was an equity investor and American e-infrastructure research and crossing between Silvertown to the north of principal contractor, came to a standstill. education networks GÉANT and RedCLARA. the Thames River and Greenwich peninsula, The social infrastructure PPP, which Their joint initiative BELLA, joining up in the south, easing congestion in the closed in 2016, was in dire straits, with six their continents' research and education 122-year-old Blackwall Tunnel. HGXFDWLRQEXLOGLQJVXQÀQLVKHGPRQWKV communities, committed to the project as 7KLVSURMHFWZLOODOVREHWKH8.·VÀUVWURDG before hundreds of pupils were due to arrive one of the anchor tenants. tunnel to have dedicated bus lanes and is for the 2018 academic year. Two founders Alfonso Gajate and Ross slated for operations in 2025. Mullins and later CEO Philippe Dumont The project had numerous hurdles in its steered forward a €150 million ($172.9 away, environmental objections, planning PLOOLRQ SURMHFWÀQDQFHLQIUDVWUXFWXUH delays, scrapping of the PF2 to name a few, GHYHORSPHQWIRUWKLVÀUVWGLUHFWÀEUHSDLU EXWDWWKHHQGRILWÀQDOO\PDGHLWRYHU from Europe to Latin America. WKHÀQLVKOLQH The RiverLinx consortium consists of Macquarie Capital, Cintra, Aberdeen In 2017 Alcatel Submarine Standard Investments, BAM PPP PGGM, Networks won the job of EPC and South Korean contractor SK E&C as sponsors and equity providers. contractor. A total of 14 lenders, including banks, institutional investors and an ECA, provided 7KHNPIRXUÀEUHSDLUFDEOHZLWK debt for the £1.2 billion project. up to 72Tbps capacity, will connect not just The multi-tranche debt included £450 The €100 million project had to undergo the education and research sectors as well million senior debt provided by Credit restructuring in order to ensure the delivery DVNH\ÀQDQFLDOFHQWUHVSRSXODWLRQVDQG $JULFROH,QVWLWXWRGH&UHGLWR2ÀFLDO.RUHD of all the planned schools. Carillion had data centres across the Atlantic. Carriers, Development Bank, KEB Hana, Norinchukin, to be structured out of the deal and new operators and internet content providers can and Shinsei Bank, and a direct loan of £100 contracts were agreed with replacement use the independent low-latency, carrier- million from KEXIM. Both loans have a 29- contractor Woodvale, as well as with new neutral EllaLink. It runs undersea from year tenor and priced at Libor +150-170bp. facilities management and management Fortaleza and São Paolo in Brazil to Lisbon, services providers. Madrid, Bilbao and Marseille in Portugal, Woodvale was tasked with the Spain and France. completion of the three most advanced With no detour required via North schools by August 2018 and undertake America, the round-trip time (RTT) is around survey and preliminary work for the other 50% faster. The project also involved three buildings in the bundle. The last of the development of a terrestrial network to six schools became operational in October improve onward connection to Asia and the last year (2019). rest of the world. The two shareholders of the project SPV In 2017 Alcatel Submarine Networks – Inspiredspaces Bundle 5 (Ireland) Limited won the job of EPC contractor year. – DIF Infra 4 Limited and Carillion – were Manufacturing started in 2019 and the previously to invest £9 million of equity in cable should be ready for service later in the project, divided equally between them. 2020. After Carillion’s collapse, the remaining Marguerite Fund invested early shareholder took over the 25-year development capital eight months ahead of A private placement of £100 million was concession as 100% equity provider and WKHSURMHFWHYHQUHDFKLQJÀQDOLQYHVWPHQW provided by Aviva and Samsung Life over a brought the restructuring to a close on 1 GHFLVLRQSURSHOOLQJWKHSURMHFWWRÀQDQFLDO tenor of 29 years and at a pricing of +150- October 2019. close on 9 January 2019 with €70 million 170bp over Gilts. A debt facility of £375 The two original lenders – MUFG and equity. The EU and state banks-owned million was provided by Credit Agricole, Helaba – stayed on as senior debt and equity fund is EllaLink's single major KfW IPEX and Norinchukin. It was wrapped equity bridge loan providers. At the time investor. Gajate and Mullins and some other by K-Sure and priced at 80-100bp and RIRULJLQDOÀQDQFLQJHDFKEDQNSURYLGHG individuals hold collectively 13% shares, was arranged over 18 years. Royal Bank of 50% of the €90 million debt for a 26-year alongside Marguerite's 87%. Canada provided interest rate swaps. term loan priced in a range of 130-150bp JP Morgan's €20 million nine-year A £100 million equity bridge loan – over Euribor. The tenor is understood to mezzanine loan to Marguerite's holding priced at Libor +110bp – came from Credit have been extended by a year during the company assists on its equity commitment. Agricole, DZ Bank, SMBC, and Woori Bank. restructuring. Anchor tenants Emacom, BELLA and RiverLinx and lenders were advised by Advisers involved on the restructuring Cabo Verde Telecom are providing capacity Allen & Overy, Hogan Lovells, Arcadis, Arup were William Fry, advising DIF on local law, pre-payments, toward funding remaining and Cowi. Meanwhile, TfL was advised by Clifford Chance, acting for the lenders, and project costs. KPMG, Ashurst, Pinsent Masons, and Atkins. Phillip Lee, advising NDFA.

Summer 2020 www. ijglobal.com 56 IJGlobal Awards 2019 Europe & Africa

African mining African oil & gas African transport Guinea Alumina Project Gimi Floating LNG New Owendo International Port

3URMHFWÀQDQFLQJIRUWKH*XLQHD$OXPLQD A joint venture between Golar LNG and The old port at Owendo, Gabon, had Corporation (GAC) project to the tune of First LNG Holdings – an indirectly wholly reached its max capacity of 4 million PLOOLRQLVRQHRIWKHODUJHVWJUHHQÀHOG owned subsidiary of Keppel Corporation – is tonnes of general cargo, but in June investments in the African nation and its currently converting an LNG carrier into the DQLQWHUQDWLRQDOFRQVRUWLXPÀQLVKHG ODUJHVWHYHUSURMHFWÀQDQFLQJIRUDJUHHQÀHOG $1.3 billion Gimi FLNG vessel in Singapore construction of a new port executed as a mining project. for deployment to the Tortue West Field 333ZKLFKWKHQUHDFKHGÀQDQFLDOFORVHWKH The GAC project entailed the development offshore Mauritania and Senegal. following year on 26 July 2019. RID0WSDJUHHQÀHOGEDX[LWHPLQHDQG 7KHGHDOUHSUHVHQWVWKHÀUVWFRPPHUFLDOO\ associated infrastructure, including the V\QGLFDWHGSURMHFWÀQDQFLQJRIDQ)/1* upgrade of a 134km long multi-user rail vessel in the international bank market. system and a new port terminal. Bauxite Financial close took place on 12 November exports began in August 2019. 2019 with $600 million in equity and $700 Societe Generale (through SG CIB million in debt, giving a debt/equity ratio of and Societe Generale de Banques en 54:46. *XLQpH DFWHGDVÀQDQFLDODGYLVHURULJLQDO The debt package includes a 4+7- initial lender and onshore security agent year amortising term loan with a 12-year LQWKHPSURMHFWÀQDQFLQJIRUWKH XQGHUO\LQJUHSD\PHQWSURÀOHSRVW&2' development. which is currently scheduled to take place in Q4 2022. Natixis, Clifford Capital, ING Bank, The GAC project entailed the ABN Amro Bank each acted as underwriters, bookrunners and initial MLAs. DBS, SCB, development of a 12Mtpa Intesa and OCBC acted as the initial MLAs, A joint venture – GSEZ JV – consisting of JUHHQÀHOGEDX[LWHPLQHDQG while DBJ, CUB, CIC and Morgan Stanley Olam International, Gabonese Caisse des acted as initial arrangers. Depots et Consignations (CDC) and the associated infrastructure. The donor vessel is the LNG Carrier Africa Finance Corporation (AFC), signed off Gimi previously owned by Golar and the RQWKHÀQDQFLQJRIWKH½PLOOLRQ  With overall project costs of $1.4bn, the conversion works are taking place at Keppel million) New Owendo International Port PPP debt package was provided by development Shipyard in Singapore. Keppel engaged (NOIP), which is being operated through the ÀQDQFHLQVWLWXWLRQVH[SRUWFUHGLWDJHQFLHV Black & Veatch to design, procure and Gabon Special Economic Zone Ports (GSEZ and international commercial banks, commission the topsides, and liquefaction Ports) project company. CDC is owned by including the IFC ($330m), the ADB process via the use of its liquefaction the government of Gabon, while the AFC is ($100m), EDC ($150m), with additional WHFKQRORJ\ZKLFKRIIHUVPRUHÁH[LELOLW\DQG one of the region’s most prominent DFIs. funds provided by two European FRVWHIÀFLHQF\LQWKHOLTXHIDFWLRQSURFHVV The deal was geared heavily towards the GHYHORSPHQWÀQDQFHLQVWLWXWLRQVRQHRI Gimi FLNG will be modelled on the Hilli equity side, but nonetheless, including the which is the Emerging Africa Infrastructure Episeyo FLNG. AFC, the deal attracted three Africa-focused Fund. '),V²WZRRIWKRVHIRUWKHGHEWÀQDQFLQJ Commercial banks participating include PIDG member Emerging Africa Infrastructure Societe Generale, ING Bank, Natixis, First Fund (EAIF) led the lender team which Abu Dhabi Bank, Emirates NBD, and otherwise included the African Development Mashreq Bank. Fund (AfDB) in an equally split €80 million 6XFKFROODERUDWLRQPDUNVWKHÀUVWWLPH debt package on a 15-year tenor. multilaterals and international commercial French joint stock company and banks have participated together on a investment fund STOA acquired a 10% JUHHQÀHOGPLQLQJSURMHFWLQ*XLQHD equity stake in GSEZ Ports in November The Multilateral Investment Guarantee 2019, just over four months after the Agency extended up to $129m of political ÀQDQFLDOFORVHGDWH7KLVVKDUHKROGLQJ risk insurance cover to commercial banks arrangement left the GSEZ JV with 90% of participating in the loan. the remaining shares. The project is being developed by Guinea BP will charter the FLNG for a 20-year The new port adds an additional 4 million Alumina Corporation, a wholly-owned period, which will begin following the four- tonnes of capacity to Gabon’s coast, which subsidiary of Emirates Global Aluminium year conversion process – upon completion is an important trade and logistics corridor – the world's largest 'premium aluminium' it will be delivered to and installed at Tortue for the Central African region. GSEZ Ports producer and largest industrial company in :HVWÀHOGRIIWKHFRDVWRI:HVW$IULFD has a 30-year concession agreement from the United Arab Emirates outside oil and gas. where the vessel will liquify gas from the the government of Gabon to operate NOIP ,WLVWKHÀUVWSKDVHRI*$&·VLQYHVWPHQW BP-owned offshore block. The Gimi FLNG which is located 27km south of the capital in the country, with the construction of an vessel will produce at least 2.5 million city of Libreville. DOXPLQDUHÀQHU\HQYLVDJHGLQDODWHUVHFRQG WRQQHVD\HDURI/1*LQWKHÀUVWSKDVHRI The sponsors were advised by Linklaters, phase. BP’s Greater Tortue Ahmeyim project. AECOM, and Royal Haskoning. Meanwhile, Estimates put the GDP impact of the Shearman & Sterling advised Golar the lenders were advised by Clifford project at $700 million annually, or 5.5% of LNG. The lenders were advised by Clifford Chance, Project Lawyers, WSP, Marsh, Ernst Guinea’s GDP. Chance. & Young, Mazars and KPMG.

Summer 2020 www. ijglobal.com 57 IJGlobal Awards 2019 Europe & Africa

$IULFDQUHÀQDQFLQJ African power African renewables 6RFLHWH,YRULHQQHGH5DIÀQDJH Bridge Power Kahone and Toube Solar

7KHUHÀQDQFLQJRI6RFLpWp,YRLULHQQHGH An Endeavour Energy-led consortium The International Finance Corporation’s 5DIÀQDJH·V 6,5 KLVWRULFDOGHEWE\WKH$IULFD UHÀQDQFHGWKHPLOOLRQÀUVWSKDVH (IFC) Scaling Solar programme in Senegal Finance Corporation is the IJGlobal African of its 424MW Bridge Power combined featured the 35MW Kahone and 25MW UHÀQDQFLQJRIWKH\HDU cycle project in Tema, Ghana – potentially Toube solar projects, each with tariffs well This deal attracted a panel of African- mitigating risk for the second phase of the below the West Africa average – $0.038 based and international lenders proving that, XWLOLW\VFDOHSURMHFWLQDGLIÀFXOWPDUNHW and $0.039/kWh respectively. if structured well, there is broad appetite for The Early Power consortium – consisting A sponsor consortium of Engie and African debt. of Endeavour Energy, General Electric Meridiam won out with its low bids out of SIR has an installed capacity of 3.8 million (GE) and Sage – signed a 20-year power 12 bids in total for the two projects, all of WRQQHVUHÀQLQJFDSDFLW\SHUDQQXPLWLV purchase agreement in October 2016 with which were below $0.06/kWh. Senegal’s currently the largest and most sophisticated the Electricity Corporation of Ghana, with ESRC chose the lowest bids on offer, but RSHUDWLRQDOUHÀQHU\LQ:HVW$IULFDHQMR\LQJ payments backed by a sovereign guarantee. any one of the alternatives were well below the largest revenues in Cote d'Ivoire. the region average of $0.25/kWh, according An unfortunate mix of domestic to World Bank data. and market challenges caused SIR to The IFC has an overarching role as the DFFXPXODWHVLJQLÀFDQWDUUHDUVLQSDUWLFXODU transaction advisers to the government and for crude oil feedstock, thereby threatening the debt arranger, as per its responsibilities WKHUHÀQHU\·VVROYHQF\DQGSURÀWDELOLW\ under the Scaling Solar Programme. The The Africa Finance Corporate (AFC) World Bank Group member signed on two stepped in as sole mandated lead arranger separate debt packages for Kahone and for a facility to repay these historical Toube, with the other two lenders being obligations, provide a long tenured facility, Proparco and EIB. The debt on the smaller and reduce the interest rate of SIR’s debt. Toube site is marginally cheaper, but otherwise the €38 million ($41.3 million) loans carry a 19-year tenor. This deal attracted a panel of Senelec is the offtaker of both the 25-year African-based and international take-or-pay PPAs. MIGA provided political lenders. risk guarantees of €7.2 million for a 15-year 7KHÀUVWSKDVHRIWKHSURMHFWZDVIXQGHG period. E\PLOOLRQLQYHQGRUÀQDQFLQJIURP Engie and Meridiam took equal 40% As a multilateral, AFC was able to offer Mytilineos and GE on 18 December 2018, stakes, while the government of Senegal – longer term debt than most commercial ZLWKWKHYLHZWRUHÀQDQFLQJWKURXJKVHQLRU through sovereign fund FONSIS – retained a banks, and ultimately successfully raised a debt facilities signed by commercial banks 20% stake in both projects. ½PLOOLRQVWUXFWXUHGGHEWÀQDQFLQJIRU in the new year. GuarantCo signed a $50 SIR. AFC’s participation was for €192 million. million guarantee for the debt provided by The facility comprises two Euro tranches the EPC contractors, which in turn began with a 9-year maturity lent by Deutsche construction of phase one. Bank, ICBC Standard Bank and LEAP. 7KHUHTXLVLWHUHÀQDQFLQJVLJQHGDOPRVWD 2QHWUDQFKHLVDÀ[HGUDWHWUDQFKHZLWK year later on 14 December 2019 on a debt prepayment restrictions in line with package totalling $510 million. The lenders expectations of institutional investors; the were led by Standard Chartered Bank RWKHULVDÁRDWLQJUDWHWUDQFKHZLWKWHQRU and include Absa Bank, Emerging Africa reduction structures. West African CFA franc Infrastructure Fund, CDC Group, Hungarian tranche with a 7-year maturity was lent by Export-Import Bank, Societe Generale, and UBA, Bridge Bank and NSIA. The multi- the Development Bank of Southern Africa. currency facility was designed to appeal to USAID joined the returning GuarantCo for a broad base of investors. debt guarantees on the deal. The long-term funding solution to The project has an overall cost of UHÀQDQFHKLVWRULFDODFFUXHGGHEWVZLOO $953 million. Phase two will add 200MW The IFC’s Scaling Solar Programme has free up resources to enable SIR to make of installed power capacity and when shown the validity of photovoltaic as a much needed investments in its current complete the power plant will provide at cheap source of energy in Sub-Saharan operations and upgrade its facility and least 17% of Ghana’s baseload energy Africa – the government has signed up for production processes to align with current supply. SCB is once again the MLA for a total of 200MW, but only 60MW has been environmental emissions standards and phase 2. procured so far. As has been taking place in expand its business. The sponsors are being advised by Zambia, a second round of projects may be An insurance guarantee programme Clifford Chance, Senet Corporate Solicitors, forthcoming. underpinned by ATI (providing €255 million) Allen & Overy and Marsh. The lenders are The sponsors were advised by Hogan with Texel acting as insurance broker being advised by Norton Rose Fulbright, Lovells. The government was advised by the enabled some investors to participate in ENSAfrica, Indecs, HIS Markit, MOT IFC, Linklaters and JLT. The lenders were the transaction that had not traditionally MacDonald and BDO. Mytillineos is being advised by Herbert Smith Freehills, Everoze, invested in Africa. advised by DLA Piper. Marsh, and ERM.

Summer 2020 www. ijglobal.com 58 IJGlobal Awards 2019 The Americas

The Americas

Had it not been for the coronavirus Winners in the North American Winners in the Latin American pandemic, IJGlobal would have transaction category are: transaction category are: hosted its Awards Night for ‡ Battery Storage – Lawa'i Solar and ‡ Power – Norte II CCGT The Americas in March at an Battery Energy Storage System ‡ Export Finance – GNA 1 Port of Acu impressively more swell venue than ‡ Power – Hill Top Energy Center ‡ Midstream Oil & Gas – Logum previous years. ‡ Transmission – Wataynikaneyap Logistica However, IJGlobal took the Power Transmission Project ‡ M&A – TAG Pipeline Acquisition decision early on to cancel the ‡ Utility – ESAP Modernization Project ‡ Upstream Oil & Gas – Trident awards night – as well as the 3-day ‡ 5HÀQDQFLQJ² *ULGÁH[*HQHUDWLRQ Acquisition Finance Miami conference immediately prior ‡ Solar – Recurrent Energy Module ‡ Petrochemicals – Braskem Idesa to it – in the interests of the safety Safe Harbour Loan 5HÀQDQFLQJ and well-being of our partners. ‡ Renewables portfolio – Cypress ‡ Transmission – CRC Transmission The IJGlobal Awards Night 2019 &UHHNSRUWIROLRÀQDQFLQJ Line was to have been staged in The ‡ Wind - Clearway – Repowering ‡ 5HÀQDQFLQJ² El Dorado Airport Pierre, New York, pulling in the great Partnership Holdco ‡ Renewables – Pirapora II Solar PV and the good of the infrastructure ‡ Mining – Nevada Copper's Pumpkin ‡ Distributed Power – Ergon Private DQGHQHUJ\ÀQDQFHFRPPXQLW\IURP Hollow Placement across North and South America. ‡ LNG – Venture Global Calcasieu ‡ Telecoms – Internet Para Todos Before naming the winners, Pass ‡ Rail – Ferrocarril Central we at IJ are always keen to drive ‡ Midstream Oil & Gas – Midship ‡ Roads – Autopista Al Mar 1 home the impartiality of our judging Project ‡ Water – BRK Ambiental process which is famed for being ‡ Rail – Hurontario LRT the most equitably-judged in the ‡ Social Infrastructure – Corner Brook infra community, relying on a team Acute Care Hospital of independent, senior players active ‡ Roads – North Tarrant Express across the Americas. Segment 3C Lacking the fanfare – and the ‡ Airports – Newark Consolidated all-important music quiz that keeps Rent-a-Car Facility many guests rooted to their seats XQWLOWKHÀQDOPLQXWH²ZHDUHQRZ delighted to announce the winners.

Summer 2020 www. ijglobal.com 59 IJGlobal Awards 2019 The Americas

North American battery storage North American power North American transmission Lawa’i Solar and Energy Hill Top energy centre Wataynikaneyap Power Storage Transmission project Ares Management closed the $420 million AES Distributed Energy’s Lawa'i Solar and SURMHFWERQGÀQDQFLQJIRULWV+LOO7RS(QHUJ\ Wataynikaneyap Power and Fortis reached Energy Storage Project in Hawaii, the largest &HQWHULQ0DUFK,WZDVWKHÀUVWSXUH ÀQDQFLDOFORVHRQD&ELOOLRQ  operational solar and storage system in the SURMHFWERQGÀQDQFLQJRIDTXDVLPHUFKDQW billion) transmission project in northwestern ZRUOGUHDFKHGÀQDQFLDOFORVHRQ-XO\ CCGT in PJM Interconnection. Ontario in October 2019, in a deal lauded 2019. Hill Top was already the talk of the town IRUEHLQJWKHÀUVWVXFKSURMHFWWREH The project consists of a 28MW solar as far back as May 2018, when it was developed through majority ownership SKRWRYROWDLFDUUD\DQGD0:ÀYHKRXU WKHRQO\FRPELQHGF\FOHJDVÀUHGSURMHFW by First Nations, the largest Indigenous- battery storage system on the island of to clear a higher-than-expected capacity led infrastructure project in Canada, and Kaua'i. auction in PJM. the most far-reaching First Nations grid By August 2018, banks had been pitching connection in Ontario's history. WRÀQDQFHWKH&&*7ZLWKDWHUPORDQ$EXW Wataynikaneyap Power is a licensed the sponsor had different ideas, securing transmission company regulated by a fashionable gas netback and hitting the the Ontario Energy Board and majority- bond market instead. owned by 24 First Nations communities in In fall 2018, Ares was in talks to extend northwestern Ontario, in partnership with the project’s gas netback from 6.5 years Fortis and other private investors. to between eight and 10 years, eventually landing an 8.75-year deal. The debt comprises: The $375 million 10-year notes were ‡ A loan of up to C$1.34 billion ($1 billion) priced and sold into the US private from the Government of Ontario, and placement market in March 2019, producing ‡ A C$680 million ($514 million) loan from an all-in coupon below 5.5%. DV\QGLFDWHRIÀYH&DQDGLDQEDQNV The debt was sized to achieve minimum DSCRs of 1.50x, amortizing to a roughly The complex and extensive commercial, $200/kW balloon payment at maturity. regulatory and strategic issues garnered the Kroll Bond Rating Agency gave the notes collaboration of numerous Canadian law a BBB- rating, which is considered the ÀUPVLQFOXGLQJ sweet spot for private placement investors. ‡ Fasken (for the Province of Ontario) The plant was already online at the time 7KHÀQDQFLQJDOVRLQFOXGHGDPLOOLRQ RIWKHÀQDQFLQJKDYLQJEHHQFRPPLVVLRQHG revolving credit facility. ‡ Torys (for the sponsor) in January 2019. It operates as a peaker Morgan Stanley was the placement agent ‡ Stikeman Elliott on the bonds. and provides 11% of the island’s power. ‡ Davies The project sells its output to the EQT Energy was the hedge provider. member-owned Kaua’i Island Utility )ROORZLQJWKHGHEWÀQDQFLQJ$UHVVROG ‡ Osler Hoskin & Harcourt Cooperative under a 25-year power a 42% stake in the project to French fund ‡ McCarthy Tétrault manager Ardian Infrastructure Partners and purchase agreement priced at $0.11/kWh. ‡ Blaney McMurtry Societe Generale provided the $40.6 a 16% stake to Israeli insurance company PLOOLRQWHUPORDQÀQDQFLQJIRUWKHSURMHFW Menora Mivtachim Insurance. ‡ McMillan Silicon Valley Bank is also a lender. 3-6RORPRQDFWHGDVÀQDQFLDODGYLVHURQ Republic Services, the second-largest the equity raise. 7KHÀQDQFLQJQHHGHGWREHV\QFKURQL]HG provider of non-hazardous solid waste The plant’s total project cost is around on many fronts. collection, transfer, disposal, recycling and $725 million, putting the leverage ratio at Besides the dual-tranche debt, there energy services in the US, was the tax around 57%. ZDVDFRPSOH[HTXLW\ÀQDQFLQJLQYROYLQJ equity investor. The company has invested a C$220 million loan from two Canadian in several solar energy projects owned life insurance companies, supported by a by AES DE and its parent company, AES guarantee provided by the Ontario Ministry Corporation. of Finance under the Aboriginal Loan Guarantee Program. Advisers on the deal included: The 1,118 mile (1,800 km) transmission ‡ Akin Gump (borrower counsel) line is expected to be completed by 2023. ‡ Norton Rose Fulbright (lenders’ counsel). Valard, a subsidiary of Quanta Services, is ‡ Mayer Brown (tax equity counsel). the EPC contractor. The project will supply energy to As the cost of combined solar and more than 14,000 First Nations people battery storage continues to fall, the Lawa’i or residents across the region helping project will not remain the largest of its The project is expected to be online in to eliminate reliance on costly and kind for long. In Hawaii alone, AES DE has April 2021. environmentally unsustainable diesel. a 30MW/120MWh and a 60MW/240MWh Kiewit is the engineering, procurement The project was originally developed by project under development in the state, with and construction contractor. Renewable Energy Systems Canada. Fortis PPAs priced at $0.08/kWh. General Electric is the turbine supplier. acquired its 49% stake in 2016.

Summer 2020 www. ijglobal.com 60 IJGlobal Awards 2019 The Americas

North American utility 1RUWK$PHULFDQUHÀQDQFLQJ North American Solar ESAP Modernisation Project *ULGÁH[*HQHUDWLRQ Recurrent Energy Module Safe Harbour loan Ottawa’s project to modernise, maintain It’s not every day a 1.5 GW portfolio of and operate the district energy system that 20-year-old merchant peakers gets 11-year, Recurrent Energy signed a $182 million heats 80 buildings and cools 67 buildings À[HGUDWHÀQDQFLQJEXW5RFNODQG&DSLWDO dual-tranche solar safe harbour loan on 10 LQ&DQDGD·VFDSLWDOUHJLRQUHDFKHGÀQDQFLDO was able to secure just that with its GridFlex -XQH,WZDVDPRQJWKHÀUVWRILWV close on 29 May (2019). The Government Generation deal last September. kind, paving the way for a wave of deals that of Canada placed restrictions on the use of Rockland assembled the three-plant peaked toward the end of the year. long-term private capital which required the GridFlex portfolio in 2017 and 2018. It The driver behind the deals was the step winning consortium, Innovate Energy led by DFTXLUHGWKH0:/HHJDVÀUHGXQLW down of the US investment tax credit for PCL Investments, to structure the project in in Lee County, Illinois, from Dynegy for solar from 30% to 26% at the end of 2019. a way not done before in the Canadian PPP $180 million in 2017 and later snapped 6DIHKDUERUORDQVDUHEHVSRNHÀQDQFLQJ market. up a larger portfolio from AES Corporation products that come in a range of shapes subsidiary Dayton Power and Light for $241 and sizes. million. This portfolio included the 586 MW The Recurrent deal’s two tranches 7KHÀQDQFLQJFRPSULVHG Tait dual-fuel project in Dayton, Ohio, and UHÁHFWHGWKHGLIIHUHQW\LHOGDQGULVN an all bank revolver with six WKH0:0RQWSHOLHUJDVÀUHGIDFLOLW\LQ appetites of the lenders. Poneto, Indiana. banks providing C$500 million The three peakers—Lee, Tait and ($349.3 million) in debt. Montpelier—are located in the ComEd and RTO regions of PJM Interconnection. Features include carefully 7KHDFTXLVLWLRQVZHUHÀQDQFHGZLWK crafted cash sweeps that kick The project forms part of the project debt. Lee had a $220 million, seven- in in various circumstances, government’s Energy Services Acquisition year term loan package, while the portfolio Program (ESAP) and was structured as a housing Tait and Montpelier – known as including the sale or DBF(OM). The O&M obligations continue .LPXUD3RZHU²ZDVÀQDQFHGZLWKD deployment of the panels, and after construction completion, which is million, seven-year term debt package. typically not the case when there is no long Following a higher-than-expected PJM a backstop. WHUPFDSLWDOLQYROYHGLQWKHÀQDQFLQJRIWKH capacity auction in 2018, Rockland saw an project. opportunity to optimize the capital stack. Innovate Energy was selected as The resultant transaction was a $377 NordLB and Rabobank were coordinating preferred bidder in March (2019) beating million 4(a)(2) private placement with an lead arrangers on the $124 million senior Rideau Energy Partners in a two horse 11.3-year maturity and a 7.4-year weighted tranche, while Nomura led and underwrote race. The winning team is made up of average life. the $57 million junior tranche. The senior PCL Investments Canada, ENGIE, Black & loan closed on 5 September and the junior McDonald Capital, Black & McDonald, PCL loan followed on 18 September. Constructors Canada and WSP Canada. The deal was structured to give lenders 7KHÀQDQFLQJFRPSULVHGDQDOOEDQN FHUWDLQW\RIFDVKÁRZZLWKRXWWKHLUQHHGLQJ revolver with six banks providing C$500 to know the exact list of projects in which million ($349.3 million) in debt. They the modules would be deployed. were ATB Financial, Bank of Nova Scotia, Features include carefully crafted Desjardins, HSBC, SMBC and TD Bank. The cash sweeps that kick in in various banks provided two interim payments and a circumstances, including the sale or substantial completion payment. There was deployment of the panels, and a backstop nominal equity of C$100 million given there SURYLGHGE\DEDFNHQGHGÀ[HGDPRUWL]DWLRQ is no long-term debt. schedule. Equity was provided by PCL Investments The structure ensures the full repayment Canada (C$45 million), ENGIE (C$45 of debt and strong collateral coverage million), Black & McDonald Capital (C$10 while mitigating the risk of delays in the million). Construction started in 2019 and Cantor Fitzgerald and Crédit Agricole were deployment schedule and ITC eligibility. WKHFRQFHVVLRQDLUHVSODQWREHÀQLVKHG the placement agents. The transaction also provides Recurrent come 2025. Once complete Innovate The notes were marketed to 35 ZLWKWKHÁH[LELOLW\WRRSWLPL]HDQGDGMXVW Energy will operate and maintain the new investors and priced at 325 basis points its development pipeline as it bids for new system for 35 years until 2055. over Treasurys in July, producing a 5.21% solar projects over time. Part of the project includes making the all-in coupon. It was around two times Recurrent will use the proceeds of the existing heating system safer and consume oversubscribed. loans to buy modules totalling 400 MW PRUHHQHUJ\HIÀFLHQWE\FRQYHUWLQJLW The deal structure included a capacity from its parent company Canadian Solar from steam to low temperature hot water. reserve account, providing protection to and 100 MW from Risen Energy Co. Building and decommissioning plants, investors in low capacity price scenarios. Recurrent expects the modules to safe upgrading existing facilities in Ottawa and Kroll Bond Rating Agency rated the harbor projects with a combined capacity of Gatineau, includes the Cliff plant near the issuance BBB-. 1,544 MW (DC). parliament and switching from steam to Credit Agricole also chipped in with The debt will be repaid when the modules electric chillers. ancillary facilities totaling $46 million. are assigned to individual project SPVs.

Summer 2020 www. ijglobal.com 61 IJGlobal Awards 2019 The Americas

North American renewables North American wind North American mining portfolio Clearway Repowering Nevada Copper's Pumpkin Cypress Creek portfolio Hollow Clearway Energy closed the $352 million ÀQDQFLQJ UHÀQDQFLQJRILWV:LOGRUDGRDQG(OERZ With the demand for copper due to soar Creek wind repowering projects in Texas on Cubico Sustainable Investments reached in the upcoming years driven the by the 14 June, 2019. maturing electric vehicle market on account ÀQDQFLDOFORVHRQ'HFHPEHU $VWKHÀUVWJHQHUDWLRQRI86ZLQG 14 June, 2019, and 19 August, 2019 on of the metal’s conductivity. Nevada Copper projects, built in the early 2000s, grows old, Corporation closed on its $115 million a complex tax equity and back levered developers are seeking ways to extend their GHEWÀQDQFLQJWRWDOOLQJPLOOLRQIRUD SURMHFWÀQDQFLQJIRULWV3XPSNLQ+ROORZ economic useful lives while also renewing Copper Project in Yerington Nevada. portfolio of three US solar projects in the US hard-won federal tax incentives which have collectively known as Project Thor. In May 2019 the company achieved since expired. ÀQDQFLDOFORVHRQWKHPLOOLRQSURMHFW But a wind repowering is much more ÀQDQFLQJSURYLGHGHQWLUHO\E\.I:,3(;%DQN complicated than just a major repair job. In supported by a UKEF untied guarantee. As foreign investors clamor order to qualify for the US wind production to get into the US renewables tax credit, wind repowerings must meet market, London based Cubico the 80:20 rule, whereby old components must make up no more than 20% of the fair broke through in 2018 market value of the repowered project. Seasoned lenders and tax equity investors are scrutinizing independent As foreign investors clamor to get into engineers’ reports for wind repowerings like the US renewables market, London based never before. Cubico broke through in 2018, lining up the DFTXLVLWLRQVRILWVÀUVWWKUHHSURMHFWVLQWKH country from Cypress Creek Renewables. The facility reduces senior debt interest The portfolio comprises the 162 MW PDUJLQVIURPWKHEURDGHUÀQDQFLQJ Wagyu project in Texas, the 106 MW agreement, saving the company $5 million Palmetto project in South Carolina and the calculated over the tenor. 98MW Huntley project also in South Carolina. The debt package has a nine year tenor The Wagyu project is particularly notable maturing in 2028. The terms of the loan as one of the growing number of Texas DOORZIUHHH[FHVVFDVKÁRZWREHXWLOLVHGRQ solar projects to be contracted under a the Open Pit development, exploration and hedge rather than, or in addition to, a power payment of dividend. purchase agreement. ,QDGGLWLRQWRWKH.I:SURMHFWÀQDQFH Merchant risk was mitigated by cross- facility, Nevada Copper also entered into collateralizing the back levered debt across a $35 million working capital facility with the three projects and by including a tracking 7KHVWDQGRXWÀQDQFLQJRIWKH:LOGRUDGR Concord Resources and offtake agreements account to help meet balancing obligations and Elbow Creek was further complicated with Aurubis and Concord Resources. under the energy hedge. Since the hedge by preferred equity brought in at the holding Finally, these facilities were layered onto a provider did not provide a tracking account, company level from Southern Power and a PLOOLRQVWUHDPÀQDQFLQJLQ6HSWHPEHU this feature had to be provided by the partnership with Clearway Energy’s sponsor 2018 which Nevada Copper had entered lenders, a very innovative step. company, Clearway Energy Group, which into with Triple Flag. Investment into the The other offtake contracts were either provided the safe harbored turbines. mine to date has been over $350 million. corporate PPAs or busbar utility PPAs. The The 161MW Wildorado project is located Nevada Copper corporation also entered lenders of the $118 million back levered in Oldham County and has a power into a $26.4 million cost overrun facility that debt were HSBC, NordLB and Rabobank. purchase agreement with Southwestern will be drawn out of the $30 million equity The tax equity investments were Public Service Co. through 2027. offering that was raised two weeks prior to structured as inverted leases. US Bank was The 238MW Elbow Creek project, in FORVLQJWKHSURMHFWÀQDQFLQJ the tax equity investor. Howard County has a hedge with an The mine started commercial operation investment grade counterparty through in December 2019. Milbank advised KfW Advisers included: 2029. and Shearman & Sterling advised Nevada ‡ &&$ ÀQDQFLDO The lead arrangers were SMBC and Copper. ‡ 1RYRJUDGDF ÀQDQFLDO Santander. The project, a unique example of a single ‡ Winston & Strawn (equity counsel) The tax equity was provided by DVVHWFRPSDQ\WDSSLQJLQWR(&$ÀQDQFHG ‡ Milbank (lender counsel) MidAmerican Energy. The tax equity was projects, has two permits, including an ‡ Nixon Peabody (tax equity counsel) funded in two chunks when Elbow Creek underground mine and a large scale ‡ Enertis (independent engineer) and Wildorado came online, in November open pit project that is advancing toward ‡ WSP (technical adviser) 2019 and February 2020, respectively. feasibility status which is due in 2021. Clearway has invested about $111 million The underground mine has a total proven Renewable Energy Systems was EPC in equity in the projects. and probable ore reserve of 574 million alongside the developer, Cypress Creek. Such repowering deals are likely to tonnes, containing 5.22 billion pounds 7KHÀUVWRIWKHWKUHHSURMHFWVWRFORVH become a template for many more that will of copper, 990,000 ounces of gold, and Palmetto, came online in August 2019. proliferate over the next few years. 33,000 ounces of silver.

Summer 2020 www. ijglobal.com 62 IJGlobal Awards 2019 The Americas

North American LNG North American midstream oil & gas North American rail Venture Global Calcasieu Pass Midship project Hurontario Light Rail Transit

9HQWXUH*OREDO/1*UHDFKHGÀQDQFLDOFORVHWR &KHQLHUH(QHUJ\DVLJQLÀFDQW/1*SURGXFHU After a long wait, the Mobilinx Hurontario construct and commission the Calcasieu Pass and EIG Global Energy Partners, energy General Partnership consortium reached LNG facility and the associated TransCameron LQGXVWU\FDSLWDOÀQDQFLHUDUHFRVSRQVRUV ÀQDQFLDOFORVHRQWKH&ELOOLRQ pipeline in Cameron Parish, Louisiana on of the Midship Pipeline Company, a project Hurontario Light Rail Transit project in 20 August 2019, raising project costs from company aiming to create new transportation October 2019. 13 banks and a number of institutional capacity from developing gas production The plan will see 18km of new dedicated LQYHVWRUVDQGÀQDQFLDOLQVWLWXWLRQV regions STACK and SCOOP. rapid transit between Port Credit GO Station 7KHÀQDQFLDOFORVHKDVEHHQIRXU\HDUV in Mississauga to the Gateway Terminal in the making, with the sponsor raising $5.8 It will have a capacity of up to at Steeles Avenue in Brampton. The line ELOOLRQWRÀQDQFHFRQVWUXFWLRQ6WRQHSHDN will have 19 stops with connections to GO Infrastructure Partners provided $1.3 billion 1,440,000 dekatherms per day Transit’s Milton and Lakeshore West rail in equity with Venture Global LNG to provide lines. around $719.50 million. The proposed Project consists of almost Mobilinx raised C$262.8 million in senior The coordinating lead arrangers on the 200 miles of 36-inch-diameter new-build secured bonds and a C$487.29 million bank debt are Banco Santander, Bank of SLSHOLQHEHJLQQLQJLQ.LQJÀVKHU&RXQW\ VKRUWWHUPVHQLRUFUHGLWIDFLOLW\WRÀQDQFHWKH America, Bank of Nova Scotia, Goldman Oklahoma and terminating at interconnects project. Four banks provided the short-term Sachs Bank USA, ICBC, ING Capital, JP with existing interstate natural gas pipeline construction bank facility: National Bank of Morgan Chase Bank, Mizuho Bank, Morgan near Bennington, Oklahoma, for delivery Canada, HSBC Bank Canada, SMBC and Stanley Senior Funding, Natixis, Nomura to Gulf Coast and Southwest destinations. Mizuho Bank. Securities International, RBC, SMBC. It will have a capacity of up to 1,440,000 The senior secured bonds were split dekatherms per day. LQWRWZRWUDQFKHV7KHÀUVWZDVD& The new-build facilities will include a total million medium-term bonds due in 2039 The project has 20-year LNG of three mainline compressor stations, seven and a long term bond for C$139.7 million sale and purchase agreements receipt meter stations/taps and four delivery due in 2054. The medium term bond has a meters, in addition to two laterals. coupon of 3.276% and the long term bond with Shell, BP, Edison, Galp, 6RFLHWH*HQHUDOHDFWHGDVÀQDQFLDO has a coupon of 3.642%. The long-term Repsol and PGNiG. adviser, joint lead arranger and bond was underwritten by National Bank administrative agent for the $680m non- Financial and HSBC Bank Canada. Progress UHFRXUVHÀQDQFLQJRIWKH0LGVKLS3URMHFW and milestone payments are to be provided The proceeds of the debt and equity The tenor of the debt is 11.5 years. by Infrastructure Ontario and Metrolinx. ÀQDQFLQJZLOOIXOO\IXQGWKHEDODQFHRI 7KHÀQDQFLQJSURYLGHGWKHVSRQVRUVD the construction and commissioning of unique ability to obtain increased leverage Calcasieu Pass. Funding will also see the DWÀQDQFLDOLQYHVWPHQWGHFLVLRQUHODWLYHWR development of the 10 MPTA Calcasieu WKHÀUPWUDQVSRUWDWLRQDJUHHPHQWVWKDWZHUH Pass and the continued development of executed at the time of closing. Venture Global's 20 MTPA Plaquemines The sponsors intend to expand the LNG and 20 MTPA Delta LNG facilities. SLSHOLQHFDSDFLW\RUH[HFWXWHDGGLWLRQDOÀUP Kiewit is the EPC contractor on the transportation agreements in the near term. Calcasieu Pass facility. All necessary Other mandated lead arrangers include permits have been secured for Calcasieu Commonwealth Bank of Australia, Credit Pass, including FERC authorisation and Agricole Corporate and Investment Bank, non-FTA export authorisation from the US ING Capital LLC, The Korea Development Department of Energy. Bank, New York Branch, National Australia Morgan Stanley in November 2018 Bank Limited, Natixis, Bank of China (New The debt package was supported by provided Venture Global with a $220 million York Branch), Sumitomo Mitsui Banking C$56.4 million in equity from Metrolinx and bridge facility for the construction of the Corporation. Societe Generale recruited construction period progress payments of facility. Morgan Stanley and Goldman Sachs these lenders through a clever process: it C$1.2 billion. John Laing is understood to had already previously raised $635 million in issued requests for proposals to 20 potential have invested £13 million for a 35% interest equity for the Calcasieu Pass LNG. lenders to obtain competitive terms for the in the concession team. Construction began in February (2019) project sponsors. The short term senior credit will be repaid and the project is expected to reach its The RFP approach created competitive on substantial completion of construction commercial operations date in 2022. tension and achieved terms exceeding the with proceeds Metrolinx receives from the The project has 20-year LNG sale and sponsors’ expectations. substantial completion payment and equity purchase agreements with Shell, BP, Edison, Nine were selected after being asked to which will be backed by letters of credit Galp, Repsol and PGNiG. receive credit approval for $100 million to prior to contribution date. The consortium 0RUJDQ6WDQOH\DFWHGDVÀQDQFLDO provide a buffer, but all were signed off. will receive a completion payment of adviser to Venture Global LNG with A cash sweep mechanism was C$604.89 million. Latham & Watkins providing legal counsel. implemented towards the backend of Following completion, Mobilinx will be Simpson Thacher acted as legal counsel WKHUHSD\PHQWSURÀOHWRPLWLJDWHDQG responsible for the O&M and rehabilitation to Stonepeak and Skadden provided legal deleverage the term loan if additional of the LRT system and the 28 vehicles for a counsel to the lenders. contracts are not obtained. period of 30 years.

Summer 2020 www. ijglobal.com 63 IJGlobal Awards 2019 The Americas

North American social Infrastructure Corner Brook Acute Care Hospital

Just three year after the provincial government of Newfoundland and Labrador approved the project, the winning consortium led by Plenary Group carried the Corner Brook Acute Care Hospital to ÀQDQFLDOFORVHRQ$XJXVW The team was selected as preferred bidder in June (2019) with other team members including, Plenary Group (Canada), PCL Constructors Canada, PCL Investments Canada, Marco Services, Parkin Architects and B+H Architects JV, John Hearn Architects, Johnson Controls Canada, Smith and Anderson Consulting Engineering, WSP Canada, RV Anderson Associate, GJ Cahill and Plan Group. The new Western Memorial Regional Pension Plan, Fiera Capital Corporation, LQWKHKRPHVWUHWFK7KHSURMHFWZDVÀUVW Hospital in Corner Brook has a price tag of Manufacturers Life Insurance Company, announced in August 2017 with an RFQ &PLOOLRQ PLOOLRQ 7KHÀQDQFLQJ Manulife Canadian Private Debt Fund issued in January 2018. was split into three packages, a long term and Phillips, Hager & North Investment The new hospital will include the same bond for construction plus 30 years, a Management. services currently provided at the existing medium term bond with over 10 years and The equity amount was C$29 million with Western Memorial Regional Hospital. In a short term bridge loan that will be repaid Plenary Group providing C$23.2 million and addition, it will have an expanded cancer in 30 months. PCL providing C$5.8 million. care program which includes radiation TD Securities and BMO were the bond The Plenary-led team beat Atlantic services. Construction is expected to take underwriters. The bonds were sold to Healthcare Partnership and was shortlisted over four years with a 30-year concession to Canada Post Corporation Registered for the project in June 2018 but failed follow thereafter.

North American roads North Tarrant Express

The $2 billion North Tarrant Express (NTE) 3SURMHFWUHDFKHGÀQDQFLDOFORVHLQ with the combination of the pre development agreement for future expansions built into this original contract resulting in the Texas Department of Transportation realizing the value of options to extend and expand the project cementing its position as a true landmark among US P3 transactions. The $910 billion Segment 3C builds on the model used to close the original project. 7KHRZQHUVOHGE\&LQWUDÀQDQFHGWKH project with $659 million in private activity bonds (PABs). The bonds were issued by the Texas Private Activity Bond Surface Transportation Corporation and underwritten by Bank of America Merrill Lynch and Barclays Capital. The trustee was Citibank. The project will rebuild 6.7 miles from comprises Cintra (53%), APG (28.8%) and The repayment of bonds will begin on 30 north of US 81/287 (Heritage Trace Meridiam (17%). The project includes the June 2047 and will mature on 30 June Parkway) to Eagle Parkway in Denton innovative transfer of the obligations to 2058. Bonds have a coupon of 5.00%. County. It will include, reconstructed main build a $270m expansion in 2040 from The equity investment amount is $160 highway lanes, expanded frontage roads TxDOT to the developer, and incorporated a million and the total value of the project is and two TEXpress managed lanes. mechanism for the transport department to $910 million. PABs were approved in July A TIFIA loan was not used for 3C as accelerate or delay the future expansion at (2019) though the total amount at that point the developers would likely have had to its discretion. was $750 million. The PABs were secured renegotiate the existing 3A/3B loan as part This obligation is also expected to be by revenues from expressway segments 3A, of the 3C loan process. The consortium IXQGHGDQGÀQDQFHGE\SURMHFWFDVKÁRZ 3B and 3C. NTE Mobility Partners Segments 3 with no funding contribution from TxDOT.

Summer 2020 www. ijglobal.com 64 IJGlobal Awards 2019 The Americas

North American airports Newark ConRAC

Conrac Solutions Capital turned heads LQ$SULOZKHQLWUHDFKHGÀQDQFLDO close on the new Consolidated Rent-A- Car (ConRAC) facility at Newark Liberty International Airport using a unique ÀQDQFLQJVWUXFWXUHWKDWFRXOGEHFRPHD national model. The $500 million project was privately ÀQDQFHGZLWK&RQUDF6ROXWLRQVOHDVLQJWKH facility for 35 years from the Port Authority of New York and New Jersey (PANYNJ). Equity Facility Charge (CFC) applied to rental car The project encompasses all elements came from Related Fund Management transactions. PANYNJ’s contribution to the RID3²GHVLJQFRQVWUXFWLRQÀQDQFLQJ and Fengate Asset Management. The debt ÀQDQFLQJZDVUHLQHGLQDWPLOOLRQ operations, maintenance and lifecycle ÀQDQFLQJSDFNDJHZDVOHGE\08)*&,%& Unlike similar projects at other major management throughout construction and and NBC. US airports, that can put airports at risk for the 35-year lease period but is not a P3. The 7KHGHDOLQFOXGHVDÀ[HGSULFHGHVLJQ DYDLODELOLW\SD\PHQWVWKLVÀQDQFLDOVWUXFWXUH facility is being constructed on a 16.65-acre build contract for construction with a joint was made possible by CS Capital and its site, with 2,925 public parking spaces and venture of Austin Commercial and VRH equity partners, Related and Fengate, with 3,380 rental car spaces to support 10 rental &RQVWUXFWLRQ7KHÀQDQFLQJZDVVXSSOLHGE\ sponsorship from the car rental industry, brands. Construction started in May with the equity partners to be repaid solely out and the foresight of the Port Authority to completion of the public parking area in of proceeds received from the Customer embrace an innovative approach. 2021 and the ConRAC in 2023.

Ashurst is proud to have advised on IJGlobal’s North America Airports Deal of the Year The Ashurst projects team brings a great breadth of sector knowledge and an impressive track record advising all project participants, including lenders, underwriters, sponsors, and governmental authorities, on innovative and complex projects in the United States. This year we expanded our offering in the US with the launch of our Los Angeles office to further build on our capacity to deliver on major projects. We look forward to continuing to deliver the best possible service to our clients.

New York Office 55 Hudson Yards New York, NY 10001

Anna Hermelin Betty Cerini Andrew Fraiser Matthew Rickards Los Angeles Office Partner Partner Partner Partner 1299 Ocean Avenue (New York) (California) (New York) (England & Wales) Santa Monica, CA 90401

ashurst.com

Andrés Arnaldos Matthew Tague Andrew Smith Partner Partner Counsel (New York) (New York) (New York)

Summer 2020 www. ijglobal.com 65 IJGlobal Awards 2019 The Americas

Latin American power /DWLQ$PHULFDQH[SRUWÀQDQFH Latin American petrochemicals Norte II GNA 1 Port of Açu %UDVNHP,GHVDUHÀQDQFLQJ

7KLVUHÀQDQFLQJWUDQVDFWLRQZDVVSHFLDO This transaction was especially important to Petrochemical company Braskem Idesa, EHFDXVHLWPDUNHGWKHÀUVWWLPHWKDW Brazil because of the size and design of the a joint venture between Brazil’s Braskem a domestic company has had KEXIM DVVHW²DQ/1*UHJDVLÀFDWLRQSODQWIHHGLQJ and Mexico’s Grupo Idesa, burst into guarantee a project bond for overseas several power plants in a port located close the international capital markets in 2019 infrastructure assets. to one of the main offshore oil and gas with a well-received $900 million senior KST Electric Power Co. – which is a production hubs in the country. VHFXUHGRIIHULQJWRUHÀQDQFHWKHODUJHVW consortium between KEPCO, Samsung $QRYHOÀQDQFLDOVWUXFWXUHDOVRPDNHVLWD petrochemical plant in Latin America. and engineering company Techint – has special deal: in a dual-currency transaction, Citi, Sumitomo Mitsui Banking Corp and UHÀQDQFHGWKH0:1RUWH,,FRPELQHG an international development bank backed Santander were the active bookrunners on cycle gas-turbine power plant in Mexico by an ECA has guaranteed a national WKH\HDUQRQFDOOÀYHGHDOZKLFKZDV with a private placement that was partially development bank. priced with a 7.45% coupon in November. guaranteed by the Export-Import Bank of An SPV comprising Prumo Logistics, BP The deal won over investors despite Korea. DQG6LHPHQVÀQDQFHGWKHGHYHORSPHQW weaknesses in the global polyethelyne Operational since May 2013, the plant construction and operation of an LNG-to- market and rising political risk in Mexico, is located in Chihuahua, Mexico. It was power project located in the Brazilian state and was oversubscribed. The transaction tendered in 2010 by Mexican state-owned of Rio de Janeiro. also included innovative fall-away provisions utility Comisión Federal de Electricidad The companies created the SPV - UTE so that the debt becomes more like a (CFE) with a 25-year tenor, under an GNA I Geração de Energia (commonly typical corporate high yield bond as older independent power producer (IPP) contract. called GNA I) - to implement the project, SURMHFWÀQDQFHORDQVDUHUHÀQDQFHG Crédit Agricole acted as the placement which is part of the largest thermal power 7KHSURFHHGVZHUHXVHGWRUHÀQDQFH DJHQWIRUWKHERQGVZKLFKUHÀQDQFHGHEW complex in Latin America, located at the the Etileno XXI petrochemical complex in incurred during the development of the Porto do Açu region. Nanchital de Lázaro Cadenas, Veracruz, power plant. The GNA I project is expected to start which came online in April 2016. commercial operation in 2021. It includes Braskem owns a 75% stake in the JV, an integrated 1.3GW combined cycle gas while Grupo Idesa holds the remaining WXUELQH &&*7 EDVHGÀUHGSRZHUSODQWDQ 25%. Braskem is in turn owned by Brazil’s LNG import marine terminal, a transmission Odebrecht. line, and the expansion of an existing The sponsors won an ethane supply substation. agreement from PEMEX in 2009 as a The plant will be linked to Brazil’s electrical result of a process carried out by Goldman grid (SIN) and the capacity and energy will Sachs, Hogan Lovells and Enerchem be sold under regulated PPAs executed with TEK. The plant produces 1 million tons of 36 distribution companies. Financial close polyethylene per year. was achieved on 5 August 2019. Construction of the project was originally 7KHODVWSDUWRIWKHÀQDQFLQJZDVD ÀQDQFHGZLWKORDQVWRWDOLQJELOOLRQ million, 15-year loan provided by the World IURPÀQDQFLDOLQVWLWXWLRQV²LQFOXGLQJ The issuance of the bonds was split into Bank Group's IFC, which was disclosed on 3 FRPPHUFLDOEDQNVDQGGHYHORSPHQWÀQDQFH two tranches. A $250 million 18-year bond April and signed on 15 March. This loan was institutions. Brazil’s BNDES ($623 million), was covered by the KEXIM guarantee, and provided in local currency. Export Development Canada ($300 million), $151.27 million of 18-year paper was an GNA I had already signed a R1.76 billion the International Finance Corporation uncovered bond. (approximately $475 million, at exchange ($285 million) and the Inter-American 7KHERQGVEHQHÀWLQJIURPWKHZUDSZHUH rates of closing date) with BNDES, which Development Bank ($285 million) provided priced at 3.30% while the uncovered bonds received a guarantee from KfW IPEX-Bank the largest tickets. were priced at 5.7%. and was supported by German ECA Euler The covered bonds were placed with Hermes Aktiengesellschaft. international investors while the uncovered The guarantee transaction relates to a Total value: $900 million notes were sold to Korean investors. contract with Siemens, which will provide Tenor: \HDUQRQFDOOÀYH /DZÀUP&OLIIRUG&KDQFHDGYLVHG.(;,0 WKHWXUELQHVIRUWKHJDVÀUHGSODQWDQG Coupon: 7.45% and the investors on the transaction. has a contract for the turnkey construction Ratings at issuance: BB-/BB SMBC, Crédit Agricole and KEXIM of the plant, in a consortium with Andrade SURYLGHGWKHRULJLQDOÀQDQFLQJIRUWKH Gutierrez. Active bookrunners: Citi, Santander, million project in 2011 in the form of a $325 Sumitomo Mitsui Banking Corp million three-tranche loan. The SPV split is: Passive bookrunners: Banca IMI, The consortium invested the remaining ‡ Gas Natural Açu (GNA) – 67% BBVA, Mizuho $95 million. ‡ Siemens Energy and Siemens Financial Trustee: Deutsche Bank Trust Co Services – 33% Advisers: Paul Hastings, White & Case, Shareholding in the consortium breaks Milbank, Ritch Mueller. down: The main shareholder GNA and is Pricing date: 25 November 2019 ‡ KEPCO - 56% owned by: Financial close date: 2 December ‡ Samsung - 34% ‡ Prumo Logistics – 70% 2019 ‡ Techint - 10% ‡ BP Global Investments – 30%

Summer 2020 www. ijglobal.com 66 CM

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CMY IJGlobal Awards 2019 The Americas

Latin American midstream Latin American M&A Upstream oil & gas oil & gas TAG Pipeline acquisition Trident Energy acquisition Logum Logistica ÀQDQFH Petrobras’ sale of a 90% stake in its Logum Logistica – a company controlled gas pipeline subsidiary Transportadora London-headquartered oil and gas by Petrobras, Raízen, Copersucar and Associada de Gás (TAG) to France’s Engie company Trident Energy last year closed the Uniduto – signed a R1.8 billion ($337 and Canadian pension fund Caisse de ÀUVWUHVHUYHEDVHGOHQGLQJWUDQVDFWLRQLQ PLOOLRQ ÀQDQFLQJZLWKWKH1DWLRQDO%DQN dépôt et placement du Québec was the Brazil since new regulations were issued in for Economic and Social Development largest asset acquisition, privatization and May 2019. (BNDES), to expand its ethanol pipeline and DFTXLVLWLRQÀQDQFLQJLQ%UD]LOLDQKLVWRU\ The borrower used the proceeds of the storage infrastructure in January 2019. when it closed in June 2019 after years of PLOOLRQORDQWRÀQDQFHLWVDFTXLVLWLRQ 7KHIXQGVZLOOÀQDQFHDERXWNP tireless work. RIRLOÀHOGVLQWKHFRXQWU\IURP3HWUREUDV of polyducts for transporting ethanol as Petrobras launched the privatization which also marked the company’s entrance well as collection and delivery terminals process in September 2017, putting 47% into a new geographic market. in Uberaba (Minas Gerais), Ribeirão Preto of the country's entire gas infrastructure up Although loans backed by oil reserves (São Paulo), and Guarulhos (São Paulo), for sale. The huge portfolio comprises 4,500 had theoretically been an option in Brazil besides investments in the expansion of the km of gas pipelines, 12 compressor stations before, no such deals were signed until the Petrobras RP18 pipeline. and 93 city gates in the north and northeast country's oil and gas regulatory agency, Of the funds, R960 million was used to regions of Brazil offered for sale to private ANP, issued new regulations making the ÀQDOO\UHWLUHDEULGJHORDQRULJLQDOO\SURYLGHG investors. sales and purchase agreements clearer. by BNDES in 2011, which had been Petrobras selected Engie and CDPQ as Sumitomo Mitsui Banking Corp, Crédit renewed fourteen times on a short-term preferred bidders in 2018 over rival bids Agricole and ING Bank provided the debt basis. The tenor of this portion of the loan is from Mubadala Infrastructure Partners / EIG package for Trident, which was signed 17 years. Global Partners and Macquarie / Itausa, in July, just two months after the new The remaining R850 million will be used but the PB selection only marked the start regulations were issued. for new investments and is to be repaid in of a lengthy regulatory and legal process Trident acquired the assets through local 24 years. spanning a year of political uncertainty – subsidiary Trident Energy do Brasil, paying The long-term loan brings the amount including presidential elections. $851 million in two installments – a $53.2 invested by Logum to R3.3 billion since its (QJLHDQG&'34ÀQDQFHGWKHSXUFKDVH million disbursement on signing the contract formation in 2011. with more than $6 billion of debt in two and a second $797.8 million payment on The deal was impressive not only currencies, including R14 billion in seven- the closing date. Under the terms of the because of its size but also because of the year local debentures and a $2.45 billion deal, Petrobras could receive an additional complex negotiations around the terms eight-year syndicated term loan. payment of up to $200 million depending and conditions of the termination of the Since virtually all TAG’s revenues are in on future oil prices. repeatedly extended bridge loan. Brazilian reais, lead arrangers BNP Paribas, 7KHDVVHWVFRPSULVHRLOÀHOGVLQ Besides corporate guarantees provided by Crédit Agricole and Itaú provided an shallow water clusters in the Campos the sponsors, the security package included exchange rate hedge for the term loan. The Basin, off the coast of Rio de Janeiro. The WKHÀGXFLDU\VDOHRIHWKDQROE\/RJXP contingent hedge structure is unusual in assets are grouped into two clusters called DSOHGJHRI/RJXPVKDUHVWKHÀGXFLDU\ Brazil as the premium was deferred to deal Enchova and Pampo. The sale was part assignment of rights arising out of Logum's close rather than being paid up front. of Petrobras’ strategy to sell 70% of its services and operational agreements with 254 assets in mature and shallow water third parties, and surety letters provided by ÀHOGVDSODQDQQRXQFHGLQ-DQXDU\ ÀQDQFLDOLQVWLWXWLRQV Mandated lead arrangers (term loan): Trident won the assets in a competitive sale BNP Paribas, Crédit Agricole, ING, process. Mizuho, MUFG, Societe Generale, SMBC

Total value: R1.8 billion ($337 million) Coordinating banks (debentures): Bando do Brasil, Bradesco BBI, Itaú BBA Sponsors: Petrobras, Raízen Energia Total value: $851 million Legal advisers: White & Case, SA, Raízen Combustíveis SA, Uniduto Lobo de Rizzo, Jones Day, Stocche Debt value: $665 million Logística SA, Copersucar SA Forbes, Mayer Brown, Tauil & Chequer Borrower: Trident Energy Borrower: Logum Logistica Advogados, Cescon Barrieu Flesch & Barreto Advogados Private equity sponsor: Warburg Lender: BNDES Pincus Financial advisers: Citi, Morgan Tenor: 24 years Stanley, Santander Mandated lead arrangers: Crédit Agricole, ING Bank, Sumitomo Mitsui Bridge loan guarantors: Banco Insurance adviser: Willis Towers Banking Corp Bradesco, Banco Santander (Brásil), ING Watson Bank (São Paulo branch) Advisers: Herbert Smith Freehills, Total value: R31.5 billion ($8.6 billion) Walkers, Pinheiro Neto, White & Case, Advisers: Mattos Filho Total debt: $6 billion Mattos Filho, Machado Meyer Financial close date: 3 January 2019 Total equity: $2.4 billion Signing date: 24 July 2019

Summer 2020 www. ijglobal.com 68 IJGlobal Awards 2019 The Americas

Latin American Transmission /DWLQ$PHULFDQ5HÀQDQFLQJ Latin American renewables Celeo Redes Chile El Dorado airport Pirapora II Solar PV Transmission Sociedad Concesionaria Operadora This eye-catching transaction comprised Aeroportuaria Internacional (OPAIN) WKHÀUVWVXERUGLQDWHGSURMHFWLVVXDQFH This was a remarkable transaction to fund holds the concession to operate, expand, of debentures in Brazil, which will be DWUDQVPLVVLRQOLQHLQ&KLOHWKHÀUVWRILWV PRGHUQL]HDQGÀQDQFHWKH(O'RUDGR repaid by dividend distribution of the SPVs kind in the country. A single asset manager International Airport in Bogota, Colombia's constituting the project. private placement that included construction capital city. Originally developed by Canadian Solar, risk and a delayed-draw of the notes, the The two key sponsors of OPAIN are the SPV Pirapora II Solar Holding, now transaction was also notable for carrying a the Latin American conglomerate Grupo owned by EDF and Omega Energia (50:50), 30-year tenor. Argos (35%) and the airport and toll road LVVXHGGHEHQWXUHVWRÀQDQFHIXQGIXWXUH Celeo Redes Chile (CRC Transmisión) concession business owned by Argos, payments or reimburse costs and expenses sponsored the portfolio that included both Odinsa (30%). and/or the repayment of short-term EURZQÀHOGDQGJUHHQÀHOGSURMHFWVWRWDOLQJ OPAIN issued 4.09% senior secured ÀQDQFLQJVUHODWHGWRWKHLPSOHPHQWDWLRQ more than 550km of transmission lines and notes through a private placement to and operation of the Pirapora II solar eight substations. UHÀQDQFHWKH(O'RUDGRDLUSRUWZKLFKLV complex. The sponsor issued a $365 million, the third busiest in Latin America in terms 30-year bond, through its subsidiary RIWUDIÀF3URFHHGVZHUHXVHGWRUHSD\WRWDO Casablanca Transmisora de Energía, to outstanding credits abroad, in dollars, and Allianz Global Investors, which also acted to fund continued investments, although as structuring agent on the deal. The debt construction phase has been completed in priced at 5.15% and the notes are interest- January 2019. only for more than 10 years. This transaction not only represents the $GGLWLRQDOO\WKHÀQDQFLQJDOVRLQFOXGHGD ÀUVW&RORPELDQLVVXDQFHLQGROODUVLQUHFHQW $22 million VAT facility from Santander. memory, but is also one of the largest 7KHÀQDQFHVWUXFWXUHZDVLQQRYDWLYH project bonds ever issued by a Colombian for both private placement investors and company. UDWLQJDJHQFLHV,WUHTXLUHGDSURMHFWÀQDQFH The 7.5-year US dollar-denominated structure with usual covenants, EoDs and QRWHVDUHÀ[HGLQWHUHVWUDWHDQGIXOO\ The project comprises three subsidiaries, security package to maximize leverage amortizing. The notes have a six-month Pirapora II, III, and IV, with a total installed ZKLOHDFFRPPRGDWLQJWKHEURZQÀHOGDVVHW debt service reserve account (DSRA) and capacity of 115MWp. and the two large construction projects. standard provisions for dividend distribution Located in the Brazilian state of Minas The structure also had to mitigate and the incurrence of additional leverage. Gerais, the project is fully contracted with a construction risk, especially because the Exposure to foreign exchange risk is 20-year PPA signed with the electric power project had less than 50% of the rights seen as limited as approximately 75% of chamber of commercialization (CCEE), of ways for the transmission lines and revenues are US dollar-denominated. awarded in a power auction held in 2015. substations at closing date. The transaction is subordinated with The non-recourse transaction at the Another mitigated risk referred to the tariff OPAIN, the Fiduciaria Bancolombia as local level of the controlling shareholder of the UHVHWPHFKDQLVP7KHWDULIILVÀ[HGIRU collateral agent and other material sponsors SPVs responsible for the development of years and then becomes subject to a 4-year of the project company. WKHSURMHFWOHG3LUDSRUD,,WRUHDFKÀQDQFLDO tariff reset. Revenues are a mix of Chilean Final book order had 11 investors, FORVXUHFRPSOHWLQJÀQDQFLQJREWDLQHGRQH pesos and dollars. including core infrastructure players in the year earlier. Proceeds of the private placement were international markets. The transaction was In June 2018, the SPV closed a R354 XVHGWRUHÀQDQFHWKHNP'LHJRGH over subscribed by $278 million. PLOOLRQ\HDUÀQDQFLQJZLWKUHJLRQDO Almagro Transmisora de Energía (DATE) Financial close was reached on 14 development bank Banco do Nordeste do project and fund the construction of the August 2019. Brasil (BNB), which provided loans at very CASTE and MATE projects. competitive costs. CASTE comprises three subprojects. The 7KLVÀUVWSDUWRIWKHÀQDQFLQJUHFHLYHG main element is a 106.84km, 220kV power DJXDUDQWHHSDFNDJHXQWLOÀQDQFLDO line stretching between Melipilla and Viña Debt value: $415 million completion, comprising 24-month letters del Mar, located in the regions of Valparaíso RIFUHGLWFRYHULQJRIWKHÀQDQFLQJ and Metropolitana, respectively. The project Full list of sponsors: OPAIN, Argos, amount. The LC was provided by BTG also contemplates the construction of two Odinsa Pactual (60%) and BNP Paribas (40%) on a substations, Nueva Casablanca and La Lenders: pool of investors non-recourse basis, based solely on project Pólvora. guarantees. The Mataquito-Hualqui (MATE) project – Joint lead placement agent: SMBC, In September 2019, Pirapora II issued the which includes 11 subprojects – is a 360km and SMBC Nikko Securities America infrastructure debentures in local currency transmission line. totaling R118 million. The issuance was Spain's Elecnor owns a 51% stake in Tenor: 7.5 years seen as a groundbreaking transaction, Celeo Redes, while the Dutch pension Pricing: 4.09% creating an important precedent for other fund APG Asset Management controls deals in the Brazilian debt capital markets. the remaining 49% through its APG Advisers: Paul Hastings Part of the proceeds from debentures was Infrastructure Pool 2012. used to repay an existing shareholder loan.

Summer 2020 www. ijglobal.com 69 IJGlobal Awards 2019 The Americas

Latin American distributed power Ergon private placement

With a great social impact, this project is the most ambitious of its kind to date in Peru, GHVLJQHGWREHQHÀWRYHUPLOOLRQSHRSOH living in rural and remote areas of the country. Italian developer Tozzi Green’s SPV, Ergon Peru issued a $222 million green bond WRUHÀQDQFHWKHEDQNORDQIRUDVRODU39 distributed generation project that installed solar kits in rural areas across the country. SMBC also provided a letter of credit (LC) totaling $14.5 million. The senior secured government will own the projects and may bond was issued under a private placement seek a new concessionaire. Debt value: $222 million in bonds + in the US and was acquired by a group of Ergon receives an availability-based $14.5 million in LC 42 institutional investors. À[HGDQQXDOFRPSHQVDWLRQLQGH[HGWR SMBC and SMBC Nikko Securities ORFDODQG8633,LQÁDWLRQVXEMHFWWRFHUWDLQ Full list of sponsors: Tozzi Green (90%) structured the emission, which received operational and service factors received and Gardini (10%) the highest evaluation score in S&P’s green through a monthly tariff charged to the Sole Placement Agent, Bookrunner, LC bond scale with the E1 grade. project's end-users and a cross-subsidy Issuing Bank, Intercreditor Agent and 60%&DOVROHGWKHRULJLQDOÀQDQFLQJ among consumers of the energy system. Administrative Agent: SMBC structuring it and acting as a lender besides 7KLVLVWKHÀUVWRIIJULGUXUDOHOHFWULÀFDWLRQ 3HUXYLDQGHYHORSPHQWEDQN&RÀGHZLWKD for the Peruvian government to date, which Tenor: 15 years 13-year term loan totaling $142.3 million. aims to improve the living conditions and Pricing: 4.87% 7KHUHPDLQLQJÀQDQFLQJZLOOEHXVHGWRIXQG overall health and welfare of large and Advisers: Baker & McKenzie the expansion of the project from the original remote communities not connected to the (international to borrower) 19.6MW to a total capacity of 28.4MW. JULG0RVWRIWKHEHQHÀFLDULHVRIWKLVSURMHFW The new debt has a lower interest rate have either lived without electricity or relied Estudio Echecopar (local to borrower) and longer tenor. The bond is now has upon fossil fuels. Paul Hastings (international to lender) the same duration as the tenor of the PPA Peru has a goal of reaching 100% of rural awarded by the Peruvian Ministry of Energy HOHFWULÀFDWLRQE\(UJRQ·VSURMHFWDLPV Garrigues (local to lender) DQG0LQHVą\HDUV$IWHUWKDWWKH to reach up to two million people.

Latin American telecoms Internet para Todos

This transaction was complex for a number The project has already connected 2,000 IpT will take advantage of cloud of reasons aspects, not only because of the communities located in remote areas in architectures, automated network planning, QXPEHURILQYHVWRUVDQGLWVGLIIHUHQWSURÀOHV 3HUXEHQHÀWLQJDURXQGSHRSOH open radio access solutions (Open RAN) but also because of the complexity of the Approximately 100 million people in Latin DQGDFRPELQDWLRQRIRSWLPL]HGÀEHUDQG transactional and commercial agreements and America are estimated to live without microwave networks. the complexity of the local telecom industry. access to internet. Financing for this project closed in May 2019, totaling $150 million. Total value of the transaction: $150 7KHIRXUSDUWLFLSDQWVDJUHHGWRÀQDQFH million the project as co-investors, which means Equity Value: $150 million that the full amount was disbursed as Full list of sponsors: Telefónica, equity. All four became shareholders of IpT. Facebook, IDB Invest, and CAF The economically-sustainable business Advisers: model based on open access principles Clifford Chance (international legal to and new technologies was very innovative, development banks) Internet para Todos (IpT) means Internet especially for the region. Garrigues (local legal to CAF) for all. This is what Telefónica, Facebook, IpT will offer wholesale access to its IDB Invest and the Development Bank of rural broadband infrastructure through a DLA Piper (local legal to IDB Invest) Latin America (CAF) aimed at when they revenue share model that will enable mobile Rebaza, Alcázar & de las Casas (local launched this project in Peru. operators to deliver communication services legal to Facebook) This telecoms project is considered by to individuals, businesses, and other Estudio Echecopar (local legal to many to be social infrastructure. IpT is organizations in rural communities. Telefónica) an open access wholesale rural mobile Economic sustainability will be achieved Hogan Lovells (international legal to infrastructure operator which aims to through partnerships with local communities Facebook) bringing mobile broadband to remote and by using open technologies that will Baker McKenzie (international legal to populations where conventional telecom reduce the cost of deployment in areas Telefónica) infrastructure deployment is not yet where current technologies are cost economically feasible. prohibitive.

Summer 2020 www. ijglobal.com 70 IJGlobal Awards 2019 The Americas

Latin American rail Ferrocaril Central

The largest infrastructure investment in four tranches of senior debt, including a 8UXJXD\·VKLVWRU\DQGWKHÀUVWLQWHUQDWLRQDO FRPELQDWLRQRIDGROODUEDVHGÀ[HGUDWH Total value of the transaction: $1.1 billion railroad PPP in the country, Ferrocarril Central ORDQIURP,'%,QYHVWD8,À[HGUDWHWUDQFKH Debt value: $942 million is a railroad that will connect a pulp mill to from CAF, and a swap in dollars from Equity Value: $155 million the Port of Montevideo, facilitating exports. commercial lenders. IDB Invest provided a Full list of sponsors: NGE Concession, Awarded in 2018, Grupo Via Central 17-year $538 million A/B loan, supported Sacyr Concesiones, Saceem, Berkes consortium signed the 18-year contract to by Intesa Sanpaolo and SMBC. The local Lenders: Development Bank of Latin DBFM the 273km Ferrocarril Central, and FXUUHQF\WUDQFKHOLQNHGWRLQÁDWLRQ 8, ZDV America (CAF), CAF Asset Management the PPP contract has a minimum 7-year equivalent to $392 million. An infra debt fund, IDB Invest, Intesa Sanpaolo, SMBC extension option. The project comprises fund managed by CAF provided the facility Offshore Collateral, Account Bank, maintenance of 273km of the existing that will pay around 6.1% annually. Intercreditor Agent, Administrative and railway from the Paso de los Toros to 7KHÀQDQFLQJSDFNDJHZDVEDFNHGE\ Paying Agent: Citi NY Montevideo, including the reconstruction availability payments from the Ministry of Onshore Collateral Agent and Account of 80 km of existing single-track line and Transport and Public Works (MTOP). Bank: Citi Uruguay the construction of 26 km of two-way lines $LPLQJDWDGGLWLRQDOÁH[LELOLW\WROHYHUDJH Tenor: 17 years between Montevideo and Progreso. WKHHTXLW\WKHÀQDQFLQJVWUXFWXUHLQFOXGHG Advisers: Jiménez de Aréchaga, Viana & a tranche of mezzanine. Brause (Sponsor Local Legal) +DYLQJD\HDUEDQNÀQDQFLQJZLWK Having a 17-year bank a 1-year tail, was also a challenge in Baker & McKenzie (Sponsor International ÀQDQFLQJZLWKD\HDUWDLOZDV Uruguay. Although the country has a good Legal) credit rating, it also has a narrow market Clifford Chance (Senior Lenders also a challenge in Uruguay with little dollar-investment opportunities International Legal) for commercial banks and an economy Astris Finance (Financial) Financing closed in October 2019, considered too rich for most DFIs. Willis Towers Watson (Insurance Advisor) with dual-currency funding in US dollars Ferrocarril Central will take around 3 Infrata (Technical Advisor) DQGLQ8, DQLQÁDWLRQLQGH[HGFXUUHQF\ years to complete. It is a key component Infrata & ERM (E&S Advisor) unit used in Uruguay for investments). of the transport infrastructure program that PwC Uruguay (Tax & Accounting) Revenues from the project will be based Uruguay is developing to strengthen its KPMG Uruguay (Model Auditor) on availability payments in both currencies. logistics platform, being complimentary to TMF (Onshore Trustee) :LWKDQLQQRYDWLYHVWUXFWXUHÀQDQFLQJKDG the truck and port systems.

Latin American roads Autopista Al Mar 1

Colombia's Autopista al Mar 1 project tranche totalling $220 million; four peso- - the largest of the Fourth Generation denominated tranches amounting to Ps1.34 Total value of the transaction: $1.061 * URDGSURJUDPPHUHDFKHGÀQDQFLDO trillion, and one URV-denominated tranche billion close in March 2019, securing a multi- of around Ps190 billion. Debt value: $713 million tranche transaction featuring domestic and FDN provided senior debt totalling Ps553 Equity Value: $348 million international commercial and development billion ($178 million). Additionally, the Full list of sponsors: Sacyr (37.5%), banks, as well as institutional investors. institution provided credit for multilaterals, Strabag (37.5%), Concay (25%) With a 25-year contract, the 176km international banks and funds through its Lenders: Societe Generale, SMBC, KfW Autopista al Mar 1 will connect the city fund in pesos, essential to get the deal IPEX-Bank, FDN, ICO, IDB Invest, CAF, of Medellín to the main highways in the DFURVVWKHÀQLVKLQJOLQH and BlackRock country. The concessionaire Desarrollo Vial Lenders at the dollar tranche comprised Tenor: 15 years al Mar (Devimar) is owned by foreign and SMBC, KfW IPEX-Bank and Societe Advisers: local companies. Generale. On the tranche in pesos, IIC, IDB Clifford Chance – legal to the lenders The build, operate and maintain project (with IIC as agent acting on its behalf), FDN, (international) comprises the construction of the motorway ICO and CAF. And the tranche in URV was Binder Grösswang Rechtsanwälte – between Medellín and Santa Fe de provided by BlackRock. legal to lenders (Austrian) Antioquia. Devimar will also build a parallel As the majority of the project costs are Philippi Prietocarrizosa Ferrero DU & Uría tunnel of 4.6km at the Túnel de Occidente, denominated in pesos, the project will use – legal to BlackRock LPSURYLQJWUDIÀFLQDQGRXWRI0HGHOOtQ US dollars/Colombian pesos non-deliverable Brigard & Urrutia – legal to the lenders The concession contract includes the forward hedges to convert the dollars (local) rehabilitation, operation and maintenance of disbursements through construction into Paul Hastings – legal to sponsors the whole 176km concession road. pesos, eliminating the FX risk to the project (international) $XWRSLVWDDO0DUFORVHGZLWKÀQDQFLQJ during construction. Katten Muchin Rosenman UK – legal totalling Ps2.23 trillion ($713 million) with Colombian development bank Financiera regarding the hedges loans both in Colombian pesos and dollars de Desarollo Nacional (FDN) played a Godoy & Hoyos – legal to sponsors in a novel structure in the country. IXQGDPHQWDOUROHLQOHDGLQJWKHÀQDQFLQJ (local) The 15-year tenor loan included six acting as the major lender and providing Mott MacDonald (technical) different tranches, one dollar-denominated local currency to foreign institutions.

Summer 2020 www. ijglobal.com 71 IJGlobal Awards 2019 The Americas

Latin American water BRK Ambiental

%UD]LO·V%5.$PELHQWDOFORVHGÀQDQFLQJ 7KLVÀQDQFLQJDGGVWRDORDQREWDLQHGLQ around four million people. Canadian for an innovative project comprising both 2013 from Caixa Econômica Federal to the IXQGPDQDJHU%URRNÀHOGRZQVRI EURZQÀHOGDQGJUHHQÀHOGIHDWXUHVLQWKH amount of R$235.7 million, and sums from BRK Ambiental, while the infrastructure country’s largest sanitation PPP project. the Fundo de Desenvolvimento do Nordeste investment fund FI-FGTS, managed by 6DQLWDWLRQLQ%UD]LOKDVDYHU\VSHFLÀF to the amount of R$415.6 million. The terms Caixa Economica Federal, owns the legislation that limits private investments, of the latter two loans are 23 years and 20 remaining 30%. which added challenges to the negotiations. years, respectively. This project comprised the development of One of many challenging points of Total value of the transaction: R1.7 the water treatment and sanitation services this project is the sharing of guarantees billion infrastructure for the city of Recife and its between IDB and CEF. The loans will Debt value: R1.256 billion metropolitan region, in the northeast of Brazil. fund the expansion and improvement of Equity Value: R474 million The project’s total cost adds up to sanitation projects in 15 municipalities in the Full list of sponsors: BRK Ambiental R1.7 billion, divided into two phases. The metropolitan region of Recife, capital of the %URRNÀHOGDQG&DL[D·V),)*76 ÀQDQFLQJLQFOXGHVSRUWLRQVRILQYHVWPHQWV Brazilian state of Pernambuco. 30%) already made and yet to be made on Phase 7KHÀUVWSKDVHRIWKHSURMHFWFRQVLVWV Lenders: Caixa Econômica Federal, 1 of the project, from 2013 to 2019. Phase of 107km of new wastewater collection Banco do Nordeste do Brasil, IDB Invest 2 comprises investments that are to be networks, 16 pumping stations, nine Advisers: made between 2019 and 2023, according wastewater treatment stations and the Mattos Filho, Veiga Filho, Marrey Jr e to the timeline on the 35-year concession renovation of the existing network. Quiroga Advogados (local legal) contract signed in 2013 by BRK Ambiental The second phase, which will run until Hogan Lovells (international legal to as part of the Cidade Saneada programme, LQFOXGHVWKHFRQVWUXFWLRQRIÀYH IDB) the largest PPP in Brazil. treatment stations and the addition of Norton Rose Fulbright (international 3KDVHZDVFRÀQDQFHGE\,'%,QYHVW 79,000 wastewater systems in homes legal to BRK) through a 20-year long-term loan of up to and 440km of new wastewater collection Machado, Meyer, Sendacz & Opice R$342 million, and by a loan closed with network. It will increase the number of Advogados (local legal to BRK) Banco do Nordeste do Brasil (BNB) of residences connected to the sanitation Willis Towers Watson approximately R$634.5 million for the system in the region from around 40% to PwC same term. ai158325537512_BRK_Anuncio_transforming_lives_173x118mm_pl.pdfXSWRFRYHUDJHE\EHQHÀWLQJ 1 03/03/20 14:09

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Summer 2020 www. ijglobal.com 72 IJGlobal Awards 2019 $VLD3DFLÀF

$VLD3DFLÀF

It is with equal proportions of joy and :LQQHUVLQWKH$VLD3DFLÀF sadness that IJGlobal announces the transaction category are: winners of our awards for company ‡ Waste – East Rockingham EfW activity and deals closed across the ‡ Metals & Mining – Greenbushes FDOHQGDU\HDULQWKH$VLD3DFLÀF Hard Rock Lithium Mine region. The APAC team – led by regional ‡ Oil & Gas – Jambaran-Tiung Biru editor Alexandra Dockreay in Sydney Gas Processings and senior journalist Dave Doré in ‡ Petrochemicals – RAPID Hong Kong – had been looking forward ‡ Telecoms – .DFLÀF6DWHOOLWH to hosting a conference in Singapore, ‡ 5HÀQDQFLQJ² Mong Duong followed by an awards night in The Finance Holdings BV Westin. This was sadly cancelled due to the ‡ Innovation – Da Mi Floating Solar coronavirus pandemic as IJGlobal took ‡ Hydro – Tina River Rail PPP the tough decision that so many other ‡ Rail – Cross River Rail PPP organisations did in this challenging ‡ Road – Cambodia Expressway time – to cancel events in the interests of the safety and well-being of our ‡ Offshore Wind – Yunlin Offshore partners. Wind We at IJ are always keen to ‡ Onshore Wind – Super Six Wind drive home the impartiality of our ‡ Energy Storage – Hornsdale Power judging process which – we believe Reserve – is renowned for being the most ‡ ESG Finance Innovation – Sydney fairly judged, relying on a team of $LUSRUW5HÀQDQFLQJ independent, senior infrastructure and energy players active across the ‡ Power – Gulf Pluak Daeng CCGT APAC region. We are now delighted to ‡ Solar – Teknaf Solar announce the winners.

Summer 2020 www. ijglobal.com 73 IJGlobal Awards 2019 $VLD3DFLÀF

$VLD3DFLÀFZDVWH $VLD3DFLÀFPHWDOVDQGPLQLQJ $VLD3DFLÀFRLODQGJDV East Rockingham EfW Greenbushes lithium mine Jambaran-Tiung Biru gas H[SDQVLRQ UHÀQDQFLQJ processing East Rockingham Resource Recovery Facility (ERRRF) is only the second utility- Talison Lithium operates the Greenbushes Subsidiaries of Indonesian state-owned oil scale energy from waste (EfW) project Lithium Mine in Western Australia, the and gas company Pertamina – Pertamina ÀQDQFHGLQ$XVWUDOLD:LWK(555)ZLWKLQ world's largest active lithium mine, capable EP Cepu (PEPC) and Pertamina EP NPRIWKHÀUVWDW.ZLQDQD:HVWHUQ of producing 1.34 million tonnes of lithium (PEP) – are developing the Jambaran- Australia and its Perth metropolitan area has concentrates per year. Talison Lithium is Tiung Biru (JTB) gas-processing project: become the nucleus of EfW in the country. LWVHOIRQHRIRQO\ÀYHODUJHVFDOHSURGXFHUV RQHRI,QGRQHVLD·VÀYHQDWLRQDOVWUDWHJLF Original developer New Energy that dominate the global market for lithium, priorities. Sponsors have a production- Corporation brought in major international a less transparent commodity that in 2019 sharing contract with Migas, the oil and gas player Hitachi Zosen INOVA (HZI) to provide IHDWXUHGGHSUHVVHGSULFHVPDNLQJLWGLIÀFXOW regulator. The project’s aim is to monetise its moving grate combustion technology. for smaller operators. -7%JDVÀHOG·VWULOOLRQFXELFIHHWRI HZI’s EPC partner Acciona from Spain But the world-leading Greenbushes proven reserves in East Java, Indonesia. has chosen this project to take an equity facility, as it readies to expand further, has Sponsors have raised a $1.85 billion debt SRVLWLRQIRUWKHÀUVWWLPHLQLWVJOREDO(I: its eye on the long-term potential of lithium package towards PEPC’s project costs. business. in energy storage and electric vehicles. 08)*DVÀQDQFLDODGYLVHUGHYHORSHGWKH Greenbushes hard rock mine managed to ÀQDQFLQJXQGHUDOLPLWHGUHFRXUVHWUXVWHH UDLVHIXQGVWRUHÀQDQFHWKHH[LVWLQJPLQLQJ borrowing scheme (TBS) – Pertamina’s operation and fund the majority of costs ODUJHVW7%6ÀQDQFLQJLQWZRGHFDGHV,WZDV for a major expansion. The project will add WKHÀUVWHYHU3HUWDPLQDOHGOLPLWHGUHFRXUVH a third chemical-grade lithium processing 7%6ÀQDQFLQJZLWKQRUHFRXUVHWR3HUWDPLQD plant, plus a tailings retreatment facility at the parent level. for utilising tailings recovered from historic The TBS helped the borrower – New production targeting tantalum rather than York Trustee on PEPC’s behalf – cover lithium. Some works began in 2019, with risks associated with the inability to pledge Another early stage sponsor that joined construction due to take a few years. assets. The TBS also had an innovative the 300,000 tonnes of waste, 29MW energy hedging solution, allowing local and regional project was Tribe Infrastructure Group banks that were not compliant with the drawing on its international network and The revolving loan gives Dodd-Frank Act to provide interest rate experience across the Middle East and Asia ÁH[LELOLW\IRUWKHERUURZHU swaps. 3DFLÀF$IWHUDQLQWHUQDWLRQDOVHDUFK-RKQ The US dollar package, with 12 local, Laing from the UK and Masdar from Abu to progress the project at a regional and international banks on the Dhabi joined for 40% equity each around suitable pace syndicate, combined 15-year conventional ÀQDQFLDOFORVHZLWK0DVGDUGHEXWLQJLQ tranches and 10-year Islamic debt tranches. Australia. The deal was Indonesia’s largest and The Eastern Metropolitan Regional %RUURZHU:LQGÀHOG+ROGLQJVLVD ORQJHVWWHQRUSURMHFWÀQDQFLQJWKDWGLGQRW Council (a collective of four councils) holding company owning Talison Lithium. involve export credit agencies. The inclusion and City of Cockburn had each tendered :LQGÀHOG VVKDUHKROGHUVDUH&KLQHVH of Islamic debt was groundbreaking. It was manufacturing company Sichuan Tianqi 20-year waste supply contracts for red-bin 3HUWDPLQD·VÀUVW,VODPLFSURMHFWÀQDQFLQJ Lithium Industries Inc. and US-based municipal solid waste on an unusual "waste DQGWKHÀUVWWLPHIRU,VODPLFGHEWLQD7%6 arising" basis, rather than the typical "take- chemicals company Albemarle Corporation. or-pay". They only offered exclusivity over all As both the shareholders and the offtakers the red-bin waste in their areas. for Greenbushes Lithium Mine, unique 7KHVHFRXQFLOVZLOOVXIIHUQRÀQDQFLDO contractual arrangements were required. penalties for initiatives reducing red-bin Both shareholders are building downstream waste. But it fell to consultants, lenders processing facilities nearby at Kwinana and and investors to pore over forecasts to Kemerton. These, when commissioned get comfortable, assessing for example by late 2021, should receive lithium from demographic trends and the planned rollout *UHHQEXVKHV,Q-XQH:LQGÀHOGV of food and garden organics waste bins. FORVHGDSURMHFWÀQDQFHVHFXUHGMXVWDJDLQVW Australian, Japanese and European *UHHQEXVKHVPLQLQJIDFLOLW\,WUHÀQDQFHG lenders were able to provide a A$308 a A$370 million four-year revolver raised in PLOOLRQÀYH\HDUWHUPORDQZKLOHJRYHUQPHQW 2017 from the same banks, and provided the The revenues, mainly from a long- green bank Clean Energy Finance majority of the capital for the expansion. term gas sales agreement with offtaker Corporation is providing a A$57.5 million The lenders on the 2019 A$770 million Pertamina, are the primary source of debt mezzanine loan that helped in obtaining the four-year revolving credit facility are a group VHUYLFH7KHWUDQVDFWLRQZDVWKHÀUVWOLPLWHG A$128 million of total equity. of six international banks from Europe (ING, UHFRXUVHÀQDQFLQJWRKDYHD3HUWDPLQD The addition of technology for collecting HSBC, Societe Generale, BNP Paribas) subsidiary as anchor sponsor. and treating bottom ash, which an external and China (ICBC and Bank of China). Project participants included SMBC (MLA company will blend in its construction 7KHUHYROYLQJORDQJLYHVÁH[LELOLW\IRUWKH and hedge provider), DBS (MLA and hedge materials, is hoped to kick-start a new borrower to progress the project at a provider), Latham & Watkins (sponsors’ Australian market. suitable pace. legal) and Milbank (lenders’ legal).

Summer 2020 www. ijglobal.com 74 IJGlobal Awards 2019 $VLD3DFLÀF

$VLD3DFLÀFSHWURFKHPLFDOV² $VLD3DFLÀFWHOHFRPV $VLD3DFLÀFUHÀQDQFLQJ RAPID .DFLÀFVDWHOOLWH AES-VCM Mong Duong 2

Petroliam Nasional Berhad (Petronas) and .DFLÀF%URDGEDQG6DWHOOLWHV*URXS .DFLÀF  AES Corp, Posco Energy and China 6DXGL$UDPFR VELOOLRQ5HÀQHU\DQG in March 2020 entered commercial service Investment Corp own AES-VCM Mong Petrochemical Integrated Development RQLWVDVVHW.DFLÀFQHDUO\NPDERYH Duong Power – the project company of (RAPID) project was a $9.6 billion mega the equator, following the satellite’s launch WKH[0:0RQJ'XRQJFRDOÀUHG SURMHFWÀQDQFLQJLQ0DOD\VLDIRUZKDW on a SpaceX Falcon 9 rocket. The $160 power plant complex, some 220km east of is understood to be Asia's largest ever PLOOLRQUHÀQDQFLQJKDGFORVHGOHVVWKDQWZR Hanoi in Quang Ninh, Vietnam. AES-VCM SHWURFKHPLFDODQGUHÀQHU\SURMHFWDQGWKH weeks before the December 2019 launch. Mong Duong in the second half of July ODUJHVWHYHUSURMHFWÀQDQFLQJLQ6RXWKDQG 2019 engaged more than 100 investors for Southeast Asia. DELOOLRQUHÀQDQFLQJSDFNDJHLQVL[ RAPID was many years in the making, cities around the world. ZLWK3HWURQDV ÀQDOLQYHVWPHQWGHFLVLRQ On 25 July Mong Duong Finance Holdings in 2014 and that after long delays. RAPID ²WKHRIIVKRUHUHÀQDQFLQJ639²SULFHG will deliver a 300,000 barrels per day $678.5 million 144a/RegS notes, along with UHÀQHU\DQGDVWHDPFUDFNHUZKLFKSURYLGH a $402.7 million term loan and $82 million feedstock to the project's downstream debt service reserve letter of credit (DSR LC) C2/C3 polymers and glycol derivatives to purchase existing export credit agency petrochemicals complex with 3.6 million .DFLÀFLVDVKDUHGJHRVWDWLRQDU\ loans, raised in 2011 roughly four years metric tons per year production capacity. earth orbit, high-throughput satellite. The before commercial operations date. Already commercial operations at RAPID communications satellite is providing mobile Initial price guidance (IPG) was 5.625% were starting by late 2019. backhaul and broadband internet via 56 RQWKHQRWHVGXH²9LHWQDP·VÀUVW powerful spot beams to remote areas in ever project bond. “Quick conversion of 25 nations throughout South East Asia and [indications of interest] saw books grow WKH3DFLÀF,VODQGV&DWKHULQH0DUVK$VLDQ quickly with chunky orders from high quality Development Bank (ADB) assistant general institutional accounts, and were in excess counsel, said: “By doing a transaction such of $2.25 billion post lunch,” said Citi, the as this, we hope to demonstrate deals in joint global coordinator on the bonds >WKH3DFLÀF,VODQGVUHJLRQ@DUHEDQNDEOHµ with HSBC. Order books of the largest Edwards Investment Cyprus, a UK- ever sub-investment-grade project bond EDVHGIDPLO\RIÀFHLV.DFLÀF·VODUJHVW from South East Asia grew to more than This mega project is within Petronas' investor. Another owner is Oceania $3.4 billion, following the US open. Final estimated $27 billion Pengerang Integrated Women's Network Satellite (OWNSAT) and coupon compressed 50bp below IPG to Complex (PIC) in Johor, Petronas' largest its individual members. “We all invested 5.125% – about 112.5bps off the theoretical project to date. For Malaysia RAPID is a because we wanted to bring high- seven-year Vietnam sovereign bond, given game-changer, due to position the country WKURXJKSXWEURDGEDQGLQWHUQHWWRWKH3DFLÀF the government-guaranteed coal supply long-term to capitalise on growing demand Islands and particularly to the women on agreement and power purchase agreement. for energy and petrochemicals in Asia and those islands,” said OWNSAT co-founder globally. State-owned Petronas transitions Candace Johnson. "Quick conversion saw books from a more domestic focus to a major Project participants cited the unusual regional player. PL[RIÀQDQFLHUV²'),VDQ$XVWUDOLDQ grow quickly with chunky When in March 2018 Saudi Aramco pension, a European asset manager – as orders from high quality signed up to invest in 50% ownership of one of the innovative aspects of the deal. 5$3,' VUHÀQHU\DQGFUDFNHULQLWVODUJHVW ADB, Leading Asia's Private Infrastructure institutional accounts." investment abroad, it gained a crucial export Fund and MEAG participated on the $110 customer in Southeast Asia as it will supply million senior secured debt. Commonwealth Transaction innovations included a bond WRRIWKHUHÀQHU\IHHGVWRFN Superannuation Corporation, as trustee of and term loan "repack" of the existing ECA- In the region of 50 commercial banks the ARIA investment trust, delivered a $50 covered loans Korea Exim Bank and K-Sure have participated, with ECAs including million mezzanine loan. GuarantCo provided loans. The new debt has full security over from Japan, Korea, Italy, Spain and UK. a $50 million partial credit guarantee on the issuer and the existing loans enabled Commercial lenders came from Malaysia, MEAG’s tranche. Senior debt priced at full security over AES-VCM Mong Duong Singapore, China, Japan, US, Kuwait, roughly 400bp over 6-month Libor. The Power’s assets and project agreements, Australia, UK, Italy, Spain, France and PH]]DQLQHKDVDQXQGLVFORVHGÀ[HGUDWH PHDQLQJDOOSURMHFWÀQDQFHVHFXULW\ZDV Germany. Tenor was seven years across all tranches. kept in place. Their 15-year $9.7 billion debt closed 22 .DFLÀFKDGWRJHWLWVÀQDQFLHUV “The non-recourse DSR LC was the November 2019, featuring a $5.63 billion comfortable with the credit risk of telcos and most innovative aspect of the transaction,” uncovered facility, one of the largest ever internet service providers in frontier markets. said James Meffen, AES director of project LQ$VLD3DFLÀFSULFHGYHU\ORZVWDUWLQJ ´2QHRIWKHPDLQULVNVLVGHÀQLWHO\RIIWDNHU ÀQDQFH´,WKLQNWKDWZDVKDUGIRUHYHU\ERG\ at 95bps. There are two special purpose ULVNLQRXULQGXVWU\µVDLG.DFLÀF·VIRXQGHU involved to agree on.” HSBC director of YHKLFOHV 639V IRUWKHUHÀQHU\DQGFUDFNHU and chief executive Christian Patouraux. LQIUDVWUXFWXUHÀQDQFH5HPL'HJHOFNHQRWHG and then the petrochemicals complex, with “Bankers need to balance their credit risk “Certainly in Asia, DSR LC has not been the SPVs able to share liabilities and on-loan assessment with deeper market analysis. seen in many transactions. It required a lot of proceeds. They tend to tip the scales to the former.” structuring and negotiating with the banks.”

Summer 2020 www. ijglobal.com 75 IJGlobal Awards 2019 $VLD3DFLÀF

$VLD3DFLÀF,QQRYDWLRQ $VLD3DFLÀFK\GUR $VLD3DFLÀFUDLO 'D0LÁRDWLQJVRODU Tina River Rail PPP Cross River Rail PPP

Project sponsor Da Nhim–Ham Thuan–Da Mi 6RORPRQ,VODQGVLQWKH6RXWK3DFLÀFUHOLHV The A$5.4 billion ($3.76 billion) 10.2km Hydro Power (DHD) – a third-tier subsidiary almost entirely on imported diesel (97%), Cross River Rail in Brisbane, Australia is of Vietnamese monopoly state utility EVN – with volatility in diesel pricing passing on a highly complex feat of engineering to KDVGHYHORSHGWKH0:'D0LÁRDWLQJ from utility Solomon Power to consumers. deliver an entirely new heavy rail line. It is PV solar project on a reservoir of its existing The long-running Tina River Hydro project, Queensland's largest ever PPP procurement. 175MW Da Mi hydropower plant in Binh ÀUVWFRQFHLYHGLQYHU\HDUO\VWXGLHVLQ It could support an enormous 7,700 jobs in Thuan. DHD’s status as a state-owned DVWKHQDWLRQ VÀUVWUHQHZDEOHSURMHFW WRWDORYHUÀYH\HDUVRIFRQVWUXFWLRQ enterprise and subsidiary of the monopoly should dramatically reduce consumer The tunnels, stations and development electricity utility EVN, which has a strong energy costs. Capital Honiara's reliance on (TSD) works package that the Queensland relationship with the Asian Development diesel should fall to around 30%, with the Government procured as an availability- Bank (ADB), helped to smooth the way. cost per kWh in Solomon Power's 30-year based PPP involves construction of 5.9km $'%DV'+'·VÀQDQFLDODGYLVHUKHOSHG 33$DURXQGRQHWKLUGORZHUDWÀQDQFLDOFORVH twin tunnels under the Brisbane River and structure the $37 million debt package than the prevailing diesel cost. central business district, plus four new into three US dollar tranches. Structuring stations underground and two station involved ADB's ordinary capital resources, Tina River Hydro should also upgrades above ground. Construction DEOHQGHGFRQFHVVLRQDOFRÀQDQFLQJIURP will take 4.8 years, followed by a 24-year Canadian Climate Fund for the Private reduce annual CO2 emissions maintenance phase. Sector in Asia and its follow-on fund, and by equivalent to 49,500 tonnes. Competition in the tender was competitive a parallel loan from Japan International as ever for a large-scale PPP in Australia, Cooperation Agency-supported Leading with the PULSE consortium of Australian, Asia’s Private Infrastructure Fund. A source Tina River Hydro should also reduce 'XWFKDQG,WDOLDQHTXLW\SDUWQHUV3DFLÀF understands ADB’s loan to have a 15-year annual CO2 emissions by equivalent to Partnerships, DIF, BAM PPP PGGM tenor and pricing in line with Vietnam’s 10- 49,500 tonnes. Coöperatie and Ghella Investment & year sovereign-risk spread. The government, not long out of civil Partnerships emerging victorious. Their group war, worked closely with World Bank on contracting arms will undertake the works. studies and then the International Finance Pulse beat a team led by Plenary with “International lenders are not &RUSRUDWLRQDVÀQDQFLDODGYLVHU7KH\ partners from Australia, Spain, Italy, and comfortable with the current structured a build, own, operate, transfer Korea and another led by Capella Capital domestic PPA terms." FRQWUDFWWKHQDWLRQ VÀUVW333 with long-term QIC money and Australian Challenges during early stages were a and French contractors. lack of data on the site, plus identifying 'D0LLV9LHWQDP·VÀUVWODUJHVFDOHÁRDWLQJ and registering tribal land owners. solar PV project and the largest in Southeast Newly-established Tina Core Land Co Asia. “The pairing of these two clean energy (50/50) owned by tribes cooperatives technologies – hydropower and solar – is a and government) will lease the land. The simple but a highly innovative achievement, cooperatives ensure around 4,000 men, which can be replicated elsewhere in ZRPHQDQGFKLOGUHQZLOOVKDUHEHQHÀWV 9LHWQDPDQGDFURVV$VLDDQGWKH3DFLÀFµ equally. It is a complex 15MW high dam said ADB’s deputy director-general of private hydroelectric facility in a high-cost geography. sector operations Christopher Thieme. Only the Korea Water Resources 0DFTXDULH&DSLWDOZDVVSRQVRUV ÀQDQFLDO “International lenders are not comfortable Corporation (K-water) and Hyundai adviser, collaborating to raise on 1 July with the current domestic PPA terms, and Engineering Co. (HEC) consortium stayed in 2019 a six-years-and-seven-months A$2.1 ORFDOEDQNVODFNH[SHULHQFHLQÀQDQFLQJ the procurement to the end. billion term debt for construction from 11 renewable energy projects,” said an ADB A pivotal shift happened during 2014- international banks from Japan, Spain, VRXUFH´7KHSURMHFWZDVÀQDQFHGXVLQJD 2015's global oil price crash, with Tina France, Italy, Germany, and the UK before hybrid structure with debt sizing based on River Hydro transitioning from a commercial syndication. There is also a A$109 million SURMHFWFDVKÁRZVDQGDQDFFHSWDEOHOHYHORI ÀQDQFHVWUXFWXUHXVLQJSULYDWHVHFWRU guaranteed facility and A$58 million debt gearing, with additional credit enhancement windows of development banks, to a fully service reserve facility. provided by the revenues from DHD's already FRQFHVVLRQDOÀQDQFH Queensland's motivation for the operating hydropower assets.” Parts of Asian Development Bank, KEXIM, undertaking is to ease congestion on Project participants also pointed to the World Bank, Green Development Fund, Brisbane's roads by enabling much higher importance of assuaging EVN's concerns Abu Dhabi Fund for Development are frequency, integrated public transport. The about the management of intermittent providing $157.975 million concessional city has only one river crossing built 40 years power on the grid. “Many grid operators are loans, all with varying tenors and interest, ago at present, an effective bottleneck on its wary of increasing the levels of renewable to Solomon Islands Government. Grants transport network, and four inner-city stations. energy, particularly solar,” said a project totalling $50.955 million also go direct to Stakes for the state government are high, insider. “Successful project development government. The government ring-fences with no federal contributions. In February helps inform future policy and give EVN proceeds and on-lent one single senior, 2020 Queensland's minister for the project the knowledge it seeks to negotiate secured 30-year $156 million loan to the announced the delivery authority will successfully with developers on future project company complemented by a $45 report to her directly, while setting up a renewable energy expansions.” million grant. compliance unit.

Summer 2020 www. ijglobal.com 76 IJGlobal Awards 2019 $VLD3DFLÀF

$VLD3DFLÀFURDG $VLD3DFLÀFRIIVKRUHZLQG $VLD3DFLÀFRQVKRUHZLQG Phnom Penh-Sihanoukville Yunlin offshore wind 6XSHU6L[ÀQDQFLQJ Expressway Soon after German developer wpd won the Pakistan Prime Minister Imran Khan gave The development of Cambodia’s expressway 640MW Yunlin offshore wind farm, it started his imprimatur to a cohort of 11 wind farms network will facilitate modern industrialization. looking for equity buyers in Yunneng Wind in Jhimpir wind corridor, totalling 560MW The Henan Provincial Communications Power, the project company. Japanese in total installed capacity, which reached Planning Survey and Design Institute has investors – Sojitz, JXTG Energy, Shikoku ÀQDQFLDOFORVHLQ1RYHPEHU)RUVL[RI estimated that Cambodia needs to develop Electric Power, Chudenko and Chugoku the wind farms, IFC used a programmatic 2,230km of expressway, totalling some $26 Electric Power – acquired 27% in April 2019. DSSURDFKIRUWKHÀUVWWLPHLQWKHZLQG billion in project cost, by 2040. The Design -DSDQ·VRIIVKRUHZLQGPDUNHWLVDVLJQLÀFDQW sector. Dubbed the Super Six, these wind Institute survey envisioned an expressway growth option for Sojitz. Its strategic roughly farms will be able to power 450,000 linking Cambodia’s two major economic VWDNHLQChina Development Bank and the Export- month Taibor, having the same 200bp at Bridge Factor chief executive Akbar Bilgrami, Import Bank of China. Chinese banks signed COD step-down. ZKRVHUYHGDVÀQDQFLDODGYLVHUWRHLJKWRI the syndicated loan in April 2019 and closed While Yunlin’s 18-year tenor certainly the 11 projects, including the Super Six. a month later. Sinosure is providing coverage contributed to the 10bp premium over While the six originally had the same to the EPC companies and banks, according Formosa 1’s 16-year debt, “the increase ÀQDQFLQJWHUPVDQGFRPPHUFLDOFRQWUDFWV WRDQLQVLGHVRXUFH/DZÀUPV+XQWRQ in tenor was not the sole factor,” said a each project had a different group of & Williams and DFDL advised CRBC to banker. sponsors and lenders. Some projects had commercial close on the 50-year concession. ´$ODUJHFRQWULEXWRULVGHÀQLWHO\WKH only USD debt, others had USD and PRs *RYHUQPHQWRIÀFLDOVDQGSURMHFW increase in scale, as Yunlin soaked up a lot loans, while still others had USD and local participants expect the build-operate- of NTD liquidity. When you take that much Islamic debt. Participants, therefore, had to transfer project, as part of China’s Belt NTD off the table, you need to pay.” GHVLJQVLJQLÀFDQWRSWLRQDOLW\LQWKHWHPSODWH and Road Initiative, to birth an important Three European ECAs participated to documentation. economic corridor. The 190km, four-lane provide the required coverage for Yunlin's highway will connect Cambodia’s two major debt. EKF hit its cap to support offshore economic hubs: the capital of Phnom Penh wind projects, with Atradius and Euler and Sihanoukville – site of the South East Hermes meeting the gap. Yunlin was nation’s only deep-sea port. More than 90% $WUDGLXV·ÀUVWRIIVKRUHZLQGDQGÀUVWQRQ RI&DPERGLD·VWRWDOFRQWDLQHUWUDIÀFSDVVHV recourse Taiwanese deal. through Sihanoukville. Sponsors needed novel solutions Cambodia’s Ministry of Public Works and because some of the lenders had access to Transport anticipates that project company Taiwan dollars, while others seeking to be Cambodian PPSHV Expressway Co will involved did not. complete the Phnom Penh-Sihanoukville 7KHÀQDQFLQJVWUXFWXUHWKHUHIRUHZDV ([SUHVVZD\LQ4VRPHÀYHPRQWKV complex, comprising a mix of local currency ahead of schedule. and Euro debt, ECA covered tranches and “Each sponsor likes to get a better The Shenzhen Urban Planning and unfunded risk participations. deal than their peers, and here we were Design Institute had created a master plan The transaction also featured an proposing they would basically get the for Shenzhen, China in the early 1990s. innovative working capital facility, bridging same deal,” remarked the Bridge Factor It emerged in 2019 that the Cambodian pre-completion revenues. This deal had chief executive. “Once it was all done, Government has tasked the institute to sizeable currency and interest rate however, the sponsors appreciated the reprise that role and design a master plan hedging, while Deutsche Bank provided a programmatic approach to achieve close, for Sihanoukville, to transform the port city groundbreaking deal-contingent interest rate as they saved on legal, due diligence and into the Shenzhen of Cambodia. swap. travel costs.”

Summer 2020 www. ijglobal.com 77 IJGlobal Awards 2019 $VLD3DFLÀF

$VLD3DFLÀF(QHUJ\VWRUDJH $VLD3DFLÀF(6*)LQDQFH $VLD3DFLÀFSRZHU Hornsdale power reserve Innovation Gulf Pluak Daeng CCGT 6\GQH\$LUSRUWUHÀQDQFLQJ Neoen's Hornsdale Power Reserve is a Gulf Group’s subsidiary Gulf Energy 100MW/129MWh operational lithium-ion Sydney Airport's operator has been Development and Mitsui & Co’s Mit-Power battery energy storage (BESS) system pioneering in its commitment to Capitals in November 2019 reached in South Australia. The project grabbed environmental social and governance (ESG) ÀQDQFLDOFORVHRQWKH%WELOOLRQ  world headlines when battery-maker Tesla SULQFLSOHVVLQFHZKHQLWZDVWKHÀUVW billion) Gulf Pluak Daeng (GPD) combined- wagered with the state government in 2017 Australian airport to report on sustainability cycle gas turbine power plant complex in it could build it within 100 days or else hand performance. It has an ambitious target to Pluak Daeng, Rayong. it over for free. The battery was operating by be carbon neutral by 2025 and in another They have a long-term relationship, as November that year. pro-active initiative, management saw their joint venture Independent Power It retains the status of the world's largest the opportunity to link funding costs with Development Company (IPD) is holding standalone BESS. sustainability. ANZ and BNP Paribas, both company of both the 4x 662.5MW GPD Most recently it prevented blackouts in banks with prior experience in sustainability- CCGT complex and the GSRC complex in February 2020 storms when South Australia's linked loans, were mandated as joint Sriracha 45km inland. JULGZDVLVODQGHG,QLWVÀUVW\HDUWKH%(66 sustainability coordinators to collaborate on The project company for the GPD saved more than $50 million for energy DPDMRUPXOWLEDQNUHÀQDQFLQJ CCGT – Gulf PD Co (GPDC) – structured consumers, by providing ongoing grid a more than Bt41 billion dual-currency, stability services and emergency back-up. 23-year debt package. An international ,Q1RYHPEHU1HRHQUDLVHGWKHÀUVW "The interest rate changes are mix of seven lenders, including Japan SURMHFWÀQDQFLQJIRUDVWDQGDORQH%(66 Bank for International Cooperation, Asian connected to Australia's National Electricity modest but meaningful." Development Bank (ADB) and Export- Market (NEM). The special purpose vehicle Import Bank of Thailand, contributed $527.1 639 UDLVHGSURMHFWÀQDQFHIRUWKHH[LVWLQJ Precedents have been either outside million to the hard currency tranches. battery and a roughly A$71 million project to $VLD3DFLÀFRUDVPDOO$PLOOLRQVLQJOH Nine local banks, led by Bank of Ayudhya add 50MW/64.5MWh capacity and upgrade lender sustainability-linked loan for another Bangkok Bank, Krung Thai Bank and Siam to Tesla's Virtual Machine Mode. Australian airport with debt pricing moving Commercial Bank, participated in the Bt20 only one way: down. billion local currency tranches, in addition For Sydney Airport, interest rates each to the Bt6.02 billion contingency facilities. year could rise or fall by a binary amount, IJGlobalXQGHUVWDQGVWKDW*3'&À[HGWKH or stay the same. "Having established the interest rate at 3.3%. IPD entered a 20-year ÀUVWV\QGLFDWHGVXVWDLQDELOLW\OLQNHGORDQLQ swap converting the debt’s interest rate from Australia, we had to lay the groundwork in ÁRDWLQJWRÀ[HGUDWH creating the right structure and getting the “The project will build the fourth-largest banks comfortable," Sydney Airport group power plant and one of the largest treasurer Michael Momdjian said. combined cycle gas turbine power plants 2QFHH[SDQGHGWKLVZLOOEHWKHÀUVW Setting internal ESG targets did not in Thailand, which will be key in the Eastern grid-scale battery with software providing match their ambition, so Sydney Airport Economic Corridor (EEC) development plan, digital inertia services to the NEM, which selected external assessor Sustainalytics to considered as the prime economic growth long-term could build up a market for inertia. give an annual score. Sustainalytics scores driver for the country until 2028,” said ADB It could provide around half South Australia's based on: corporate governance, product deputy director-general for private sector required inertia for grid stability. governance, human capital, business ethics, operations Christopher Thieme. Federal green bank Clean Energy Finance community relations, occupational health Corporation (CEFC) provided a A$50 million DQGVDIHW\DQGHPLVVLRQVHIÁXHQWVDQG 13-year loan. Sponsor Neoen invested A$41 waste. "The project will build the fourth- million equity, after having already equity The A$1.4 billion ($965 million) revolving largest power plant in Thailand" funded the existing 100MW A$100 million credit facilities raised 23 May 2019 are in BESS. Meanwhile the commonwealth's three tranches, with bullet maturities after Australian Renewable Energy Agency gave WKUHHIRXUDQGÀYH\HDUV Project participants commented on the an A$8 million grant. There are more than 10 banks, all existing FRPSOH[ÀQDQFLQJVWUXFWXUHLQYROYLQJDPL[ With similarities to capacity market lenders, from Australia, Europe, US, Canada of US dollar and Thai baht facilities, ADB's payments, South Australia's government and Asia. "The interest rate changes are %ORDQVWUXFWXUHDQGGLUHFWÀQDQFLQJIURP ZLOOSD\$PLOOLRQD\HDUIRUÀYH\HDUVIRU modest but meaningful. They are enough ADB and JBIC. The B loans allowed OCBC the 50MW extra capacity. Meanwhile other to drive a behavioural change, incentivising and DZ Bank, international banks with revenues come from trading and arbitrage. management to further improve our limited experience in Thailand, to participate. CEFC's loan includes a market tranche sustainability performance across the entire The deal also has a back-ended equity featuring revenue sharing between ESG spectrum" says Momdjian. structure, meaning Gulf and Mitsui are project SPV and CEFC for a percentage of Management has already continued its providing corporate guarantees in favour FDVKÁRZVDQGQRPLQLPXPUHSD\PHQW momentum from 2019. In February 2020 of lenders to secure their 70/30 equity schedule. The contract-backed tranche 6\GQH\$LUSRUWLVVXHGWKHÀUVWVXVWDLQDELOLW\ contributions to IPD. A banker also said achieved a lower debt service coverage ratio linked US private placement (USPP), and that Mitsubishi Hitachi Power Systems’ is than for comparable wind or solar deals, in WKHÀUVWVXVWDLQDELOLW\OLQNHGERQGLVVXDQFH deploying a new gas turbine generator, with the absence of production risk. globally with two-way pricing movement. limited operational data.

Summer 2020 www. ijglobal.com 78 IJGlobal Awards 2019 $VLD3DFLÀF

$VLD3DFLÀFVRODU7HNQDIÀQDQFLQJ

It was July 2017 and a barren, 116-acre remote part of Cox’s Bazar, Bangladesh glistened with potential off the waters of nearby Naf River. Some 22 months later, project company Teknaf Solartech Energy (TSEL) closed on the $25 million GHEWÀQDQFLQJIRUWKH0:7HNQDIVRODU IDUP²QRZWKHÀUVWDQGRQO\RSHUDWLRQDO utility-scale solar project in Bangladesh. Dhaka-based IPP Joules Power (JPL) and a Chinese supplier own TSEL. In turn, in dual currency came from Standard a novel solution to de-risk challenges three well-respected Bangladeshi business Chartered (SCB) and Tk824 million tranches DURXQGUHÀQDQFLQJ,WDOORZV6&%WRH[LWWKH people, including Nuher Latif Khan, own from local banks One Bank, Sabinco and transaction after eight years – the typical JPL, which has an 80% equity interest in Shahjalal Islami Bank. maximum tenor– if liquidity constraints arise. the SPV. %DQJODGHVK·VÀUVW\HDUSURMHFW *XDUDQW&RVRDNVXSWKHUHÀQDQFLQJULVN $FWLQJDVDTXDVLÀQDQFLDODGYLVHU ÀQDQFLQJ²DOPRVWGRXEOHWKHW\SLFDO while the SPV continues to enjoy the entire GuarantCo – a member of London-based eight-year maximum tenor for the country’s 15-year tenor. Private Infrastructure Development Group infrastructure projects – saw GuarantCo "Rates are higher with the local bank (PIDG) – approached banks armed not only mitigating payment default and liquidity risks WUDQFKHVZKLFKUHÁHFWVRQZK\*XDUDQW&R with technical reports and environmental & on the Tk3 billion ($35.6 million) Teknaf solar coverage adds value as we can avail the social plans but also with a “bankable PPA power project. GuarantCo provided SCB with 'risk-free' rates from the banks at a longer signed by BPDB”, according to GuarantCo 90% coverage of “unconditional, irrevocable, tenure," Khan said. "SCB's pricing was very South Asia regional director Nishant Kumar. on-demand guarantee”. GuarantCo also HIÀFLHQWDVWKHLUVSUHDGWHQGVWREHORZHU Four banks joined the deal: $15 million provided a liquidity extension guarantee, than the local banks."

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Summer 2020 www. ijglobal.com 79 IJGlobal Awards 2019 Middle East & North Africa

Middle East & North Africa

IJGlobal is delighted to announce Winners in the MENA transaction the winners of our coveted awards category are: for company activity and transactions ‡ Export Finance – Al Dur 2 IWPP closed over the calendar year of 2019 across Middle East and North Africa. ‡ Mining – Alba line 6 expansion We would have been presenting (ECA facilities) these awards at The Oberoi, Dubai, in ‡ Oil & Gas – Bapco Modernization March – the IJGlobal awards season – Program but this was sadly cancelled due to the coronavirus pandemic, following close ‡ M&A – Project Beyond (ADNOC) consultation with our partners and ‡ 5HÀQDQFLQJ² Ma'aden Debt-to- clients. Equity Conversion and Capital Winners in the institutional category Increase ZHUHYRWHGRQE\VHQLRUÀJXUHVIURP across the regional infrastructure and ‡ Wind – Dumat Al Jandal Wind energy community – none allowed to Farm vote in their own business areas – in ‡ Water – Taweelah IWP what is widely regarded to be the most ‡ Power – Hamriyah IPP independently-judged awards in this sector. ‡ Solar – DEWA IV CSP

Summer 2020 www. ijglobal.com 80 IJGlobal Awards 2019 Middle East & North Africa

0(1$H[SRUWÀQDQFH MENA Mining MENA oil and gas Al Dur 2 IWPP Alba Line 6 expansion BAPCO Modernisation programme A sponsor consortium of ACWA Power, Aluminium Bahrain (Alba) closed on the Mitsui & Co, and Al Moayyed reached ECA-backed tranche of its $3 billion Line 6 The $6.8 billion BAPCO Modernisation ÀQDQFLDOFORVHRQWKHÀUVWJUHHQÀHOG,:33 expansion project at the start of the year in Programme (BMP) was funded by a $4.1 in Bahrain since the GFC – the $1.1 billion, 2019, which is a $238.3 million deal split ELOOLRQGHEWSDFNDJHZKLFKDWWUDFWHGÀYH 1.5GW Al Dur 2 IWPP with a 227,300 m3pd between two tranches. ECAs, 11 regional lenders, and a club desalination facility. 7KLVQHZGHEWZLOOEHXVHGWRÀQDQFH of eight international banks for a tailor- Bahrain’s Electricity & Water Authority equipment for the Line 6 expansion PDGHK\EULGÀQDQFLQJVWUXFWXUHVLJQHGE\ (EWA) will purchase the power and water project, which is expected to boost Alba’s Bahrain’s nogaholding. through a 20-year offtake agreement yearly production capacity at its aluminium – BD12.9935/MWh ($34.5572) and smelters by 540,000 metric tonnes to 1.5 BD0.26351/m3 ($0.70) respectively – which million metric tonnes. The deal represents is backed by the Ministry of Finance. Gas WKHVHFRQGDQGÀQDOWUDQFKHRIH[SRUWFUHGLW feedstock will be supplied by the Sitra ÀQDQFLQJIRUWKHSURMHFW UHÀQHU\ZKLFKLVVXEMHFWWRWKH%$3&2 7KHÀUVWWUDQFKHRIWKHQHZ(&$IDFLOLWLHV Modernisation Project – another project that is $136 million and is supported by Export UHDFKHGÀQDQFLDOFORVHLQ Development Canada (EDC). Citibank is the MLA and facility agent for the EDC-covered facility, which has a 10-year tenor with the principal amount to be repaid over 10 years. The other tranche comprises €90 million ($101.9 million) and is backed by the %03LVFHQWUHGRQWKHVROHUHÀQHU\LQ Japan Bank for International Cooperation Bahrain – nogaholding’s 100% owned Sitra, (JBIC) and Nippon Export and Investment which outputs 90% of BAPCO’s oil & gas Insurance (NEXI). BNP Paribas is the products. The expansion project will boost MLA and facility agent for the JBIC/NEXI- this output further, from 267,000 barrels of supported facilities which involve two oil per day (bopd) to 380,000 bopd. contract loans. One loan has a tenor of 10 Five ECAs provided debt coverage for years and a 10-year principal repayment $2.2 billion, on a 12.5-year tenor – CESCE period, while the other loan has a six-year and SACE both came in with $650 million tenor with the principal to be repaid over a each, UKEF at $400 million, K-SURE at 5.5-year period. $367 million and KEXIM at $100 million. The Alba is using the proceeds from the ECA debt pricing has a tight range of 90-150bp GLUHFWDQGJXDUDQWHHGORDQVWRÀQDQFHWKH and the portion required to be covered by The ACWA Power-led team put up $281 acquisition of new equipment. The Bahraini ECAs ended up being a third smaller than million in equity and signed two tranches company plans to become the world’s expected. on the debt-side – one covered. Euler largest smelter with the completion of this The Islamic tranche has a 16-year tenor Hermes provided cover on a fully-amortizing project. and comprises $530 million from the 14-year plus construction tenor tranche following local and regional lenders: Ahli with Standard Chartered Bank and KfW United Bank, Apicorp, Bank ABC, BBK, IPEX-Bank – with debt pricing at 105bps Banque Saudi Fransi, Bahrain Islamic Bank, over Libor. Gulf International Bank, Kuwait Finance The other tranche is uncovered and Houe, Mashreq Bank, National bank of consists of regional lenders and a Saudi Bahrain, NCB, and Riyad Bank. DFI: Apicorp, Banque Saudi Fransi, Riyad $ÀQDOWUDQFKHRIELOOLRQKDVQR Bank, and Saudi Fund for Development. This coverage – on 16-year tenor with debt carries a 19.5-year tenor, starting at 350bps pricing above 300bp. These lenders are rising to 475bps. BNP Paribas (co-MLA), HSBC (co-MLA), The EPC contractors are SEPCOIII, Credit Agricole, Credit Suisse, Natixis, PowerChina, and Sidem with Siemens Santander, Societe Generale, and Standard providing F-class gas turbines. The O&M Chartered. contract was awarded to NOMAC. The KEXIM and UKEF are also providing their power component of Al Dur 2 will provide own direct loans, totalling $357 million. 25% of Bahrain’s energy generation when Alba closed on a $1.5 billion syndicated The EPC contractors are Technip, FRQVWUXFWLRQÀQLVKHVLQ4 term-loan facility in October 2016. The Technicas Reunidas, and Samsung The sponsors were advised by Covington previous ECA deal on the project was the Engineering. & Burling and ASAR. EWA was advised PLOOLRQÀUVWWUDQFKHRI(&$ÀQDQFLQJ BAPCO was advised on the deal by by KPMG, Trowers & Hamlins, and WSP. backed by Euler Hermes and SERV, which BNP Paribas, HSBC, Shearman & Sterling, The lenders were advised by Shearman & was closed in July 2017. Linklaters, and Newton Legal. The lenders Sterling, Al Tamimi & Company, and Norton Alba was advised by JP Morgan which were advised by Allen & Overy, Haya Al Rose Fulbright, and Index. Deloitte was the also acted as the ECA coordinator on the Khalifa, Ernst & Young, Jacobs Consultancy, model auditor on the deal. EDC and JBIC/NEXI deal. Nexant, and JLT.

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MENA M&A 0(1$UHÀQDQFLQJ MENA Wind Project Beyond Ma’aden Debt-to-Equity Dumat al Jandal wind farm (ADNOC pipelines) Conversion and Capital Increase EDF and Masdar shrugged off In February 2019, KKR Infrastructure and The Saudi Arabian Mining Company disappointment elsewhere in Saudi Arabia’s BlackRock Infrastructure acquired a 40% (Ma’aden) restructured its Ma’aden Rolling ÀUVWURXQGRIUHQHZDEOHVSURFXUHPHQWE\ shareholding in special purpose vehicle Company (MRC) subsidiary through a debt- GHOLYHULQJWKHFRXQWU\·VÀUVWHYHUXWLOLW\VFDOH ADNOC Oil Pipelines for $4 billion, with to-equity conversion and capital increase ZLQGIDUPWRÀQDQFLDOFORVH²WKH0: ADNOC retaining 60%. The deal is notable after simultaneous negotiations including Dumat al Jandal project. IRUEHLQJWKHÀUVWWLPHOHDGLQJLQVWLWXWLRQDO Alcoa Corporation, the Saudi Industrial The French-Emirati consortium had put investors have partnered with a Middle Development Fund (SIDF), and the Public in a world record price for a solar energy Eastern national oil company. Investment Fund (PIF). on REPDO’s Sakaka solar project but was Ultimately the conversion led to a capital controversially omitted when RFPs were increase in Ma’aden via the debt-to-equity evaluated in January 2018. The other project conversion for the amount of SR2.9 billion in the round was the 400MW wind farm at ($796.4 million) through the issuance of Dumat al Jandal, for which EDF and Masdar new shares to the PIF. The objective was had again put in the lowest of four bids. to improve Ma’aden’s liquidity and credit The Dumat al Jandal RFPs were evaluated position while aiding its ability to reach its in January 2019 and turned up EDF/Masdar growth targets. as the winner with the offered tariff of $0.0213/kWh. This tariff was then lowered to $0.0199/kWh after interest rate swaps "This transaction will provide WRRNSODFHDKHDGRIÀQDQFLDOFORVHVLJQHG by Commercial Bank of Dubai. Saudi Power DGGLWLRQDOÁH[LELOLW\IRU0D·DGHQ Procurement Company (SPPC) will offtake to manage the rolling business energy over a renewable 20-year term which going forward." is subject to an indexation mechanism to adjust the tariff in the event that the Saudi riyal is unpegged from the US dollar. ADNOC Oil Pipelines has leased the The multi-layered transaction results in the rights, title and interest in 18 pipelines recapitalisation and associated restructuring totalling 750km in Abu Dhabi from ADNOC RI05&²0D·DGHQEHQHÀWVIURPWKHGHDOE\ for a period of 23 years. ADNOC has been allowing an overall deleveraging of MRC and granted the right to use, manage, and for a capital increase in its own accounts. operate the pipelines for the transportation 7KH6DXGLPLQLQJÀUPWUDQVIHUUHGWKH05& V of stabilised crude oil. SR2.9 billion loan from the PIF in exchange The new entity will, in turn, receive a tariff for an equivalent loan from PIF to Ma'aden, payable by ADNOC for its share of volume which enabled the recapitalisation of MRC RIFUXGHDQGFRQGHQVDWHÁRZLQJWKURXJK and the restructuring of its remaining the pipelines, backed by minimum volume commercial bank and SIDF debt. commitments. The combined capacity of At the same time, Alcoa Corporation’s the pipelines amounts to 13 million barrels 25.1% shareholding in MRC was transferred per day. to Ma’aden without any cash compensation The agreements are UAE law-governed, in exchange for the release of Alcoa from and entailed complex structuring between future MRC lenders obligations. Alcoa will the three parties. White & Case provided nonetheless retain its 25.1% interest in legal advice to ADNOC, while Milbank and the Ma’aden Aluminium Company (MAC), Simpson Thacher & Bartlett assisted KKR which operates the Aluminium smelter, and and BlackRock. in Ma’aden Bauxite and Alumina Company JP Morgan, BAML, and Moelis & (MBAC), which operates the bauxite mine in &RPSDQ\VHUYHGDVÀQDQFLDODGYLVHUV $O%D·LWKDDQGWKHDOXPLQDUHÀQHU\ERWKLQ The deal is notable in that the sale-and- Ras Al Khair Industrial City. leaseback nature of the deal could appear “This transaction will provide additional elsewhere in the region, and in other ÁH[LELOLW\IRU0D·DGHQWRPDQDJHWKH sectors. rolling business going forward, while we A club of six banks signed on the USD- Lenders provided a $3.28 billion will continue our long and successful denominated $270 million soft mini-perm senior term loan facility in support of relationship with Alcoa in our mining, debt on 30 June 2019 – the debt from the acquisition, bringing together a UHÀQLQJDQGVPHOWLQJMRLQWYHQWXUHVµVDLG KDB, Natixis, NCB, Norinchukin, SMBC, and consortium of lenders including Bank of Ma’aden’s president and chief executive Societe Generale carries a 20-year tenor China, BNPP, CaixaBank, Credit Agricole, RIÀFHU'DUUHQ'DYLVDWWKHWLPHRIFORVLQJLQ matching the PPA. Pricing starts in the low Korea Development Bank, MetLife, Mizuho June 2019. 100bps and rising in step ups to the high Bank, Nomura, Norinchukin Bank, Samba Ma’aden was advised on the 18-month 200s. These step ups will start after three Financial, Santander, SMBC, Sumitomo long debt-to-equity conversion by White & years of operation, and construction is Mistui Trust. Linklaters advised the lenders. Case. expected to take 2.5 years in total.

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MENA water MENA power MENA Solar Taweelah IWP Hamriyah IPP DEWA IV CSP

The world’s largest desalination facility and $6XPLWRPROHGFRQVRUWLXPOHGWKHÀUVW ACWA Power surfed a wave of Chinese debt the world’s cheapest water price – ACWA ever independent power producer (IPP) and equity to deliver the 950MW DEWA Power’s $1.2 billion Taweelah independent SURMHFWLQWKH6KDUMDKHPLUDWHWRÀQDQFLDO ,9&636RODUWRÀQDQFLDOFORVH²ZKLFKZLOO ZDWHUSURGXFHU ,:3 SURMHFWDOVRÀWVWKH close on 15 May 2019 – 1.8GW Hamriyah have the largest thermal solar generation in mould for an industry standard. combined-cycle gas turbine (CCGT) power the world on a 260 metre tall tower. The reasons for picking out this plant. The fourth phase of the Mohammed bin gargantuan 909,200 m3pd desalination The sponsors – Sumitomo, General 5DVKLG$O0DNWRXPVRODUSDUNLVWKHÀUVWWR facility are many: the project was brought Electric Financial Services, Sharjah Asset feature CSP technology. Soaring 260 metres WRÀQDQFLDOFORVHLQMXVWWZR\HDUVDIWHUWKH Management Holding, and Shikoku Electric into the air, the CSP tower will be the tallest feasibility study was conducted, its low tariff Power – signed with Sharjah Electricity and in the world. broke the world record, and it demonstrated Water Authority (SEWA) the 25-year PPA The PPA signed with Dubai Electricity and the strength of the soft mini-perm structure LQ-DQXDU\WKXVFRQÀUPLQJWKDWWKH Water Authority (DEWA) has a hefty term- pursued by the developer ACWA Power. emirate would be able to reduce power length of 35 years. This is also a dual-tariff The 30-year PPA was signed with EWEC imports from Abu Dhabi. Currently, Sharjah PPA – $0.074/kWh for the CSP and $0.025/ in May 2019 at the agreed tariff that won imports around 50% of its power needs kWh for the solar PV. The addition of the $&:$3RZHUWKHWHQGHULQWKHÀUVWSODFH and the rest is generated from aging low- 250MW solar component was late and only – Dh8.26 per thousand gallons (ptg) – but HIÀFLHQF\SRZHUVWDWLRQV comprises 5% of the project income for the DIWHULQWHUHVWVZDSVDKHDGRIÀQDQFLDO sponsors yet will ensure DEWA IV has a 24- close, this tariff was lowered to Dh7.80 ptg hour power generation capability. ($2.1239), thereby setting a world record. 7KHEXONRIWKHSURMHFWÀQDQFLQJZDV Abu Dhabi’s Department of Energy (DoE) arranged by ICBC through a $2.19 billion will supply power to the site but daytime facility which featured four other Chinese electricity needs will be supplied by a banks: Agricultural Bank of China, Bank of 40MW solar PV captive power unit. China, China Minsheng Bank, and the Silk Road Fund. The latter acquired a 49% stake in ACWA Power’s renewables subsidiary – RenewCo – in June 2019.

The size of the debt comes to just over $1 billion, with a debt/equity ratio of 80:20. The Japan Bank for International Cooperation (JBIC) is providing the largest tranche with a direct loan of $555 million. The JBIC intervention is part of the government of Japan’s initiative launched in 2018 to support infrastructure development projects that are expected to contribute to global environmental protection. The rest of the debt is sourced from a total of six banks on the NEXI-covered commercial bank tranche of $516 million, which priced at 135bp over Libor – they are SMBC (MLA), KfW IPEX, Norinchukin Bank, The $775 million debt package is SMTB, Standard Chartered Bank, Societe characterised by step-ups rising from a Generale. NEXI is providing 100% political ÁRRURIESRYHU/LERUXSWRESLQ\HDU risk cover and 90% credit risk insurance. seven, and then up to 240bp in year 13 The closing of Hamriyah IPP over the course of the theoretical 15-year “demonstrates that good planning and tenor. Six international banks signed on 3 clear allocation of risk aligned to regional 2FWREHUDKHDGRIÀQDQFLDOFORVH PPP norms continues to enable successful 7KHGHEWÀQDQFLQJZDVFRPSOHWHGE\ days thereafter – Boubyan Bank, Emirates SURMHFWÀQDQFLQJIRUFULWLFDOLQIUDVWUXFWXUH DVPDOOHUEXWVWLOOVLJQLÀFDQWLQWHUQDWLRQDO NBC, Mizuho Bank, Natixis, Norinchukin projects on a large scale,” a source close to tranche of $828 featuring Natixis, Standard Bank, and Siemens Bank. the deal said. Chartered Bank, and Union National Bank. ACWA Power was advised by Hogan 7KHÀUVWRIWKHWKUHHFRPELQHGF\FOH The debt package is structured as a soft Lovells on the deal. The DoE retains a units is expected to start putting out power mini-perm starting at 200bp over Libor, 60% stake in the project and was advised in May 2021, with full operation scheduled rising sharply to 330bp after nine years. by Alderbrook, White & Case, and ILF for 2023. SEWA was advised by PwC and DEWA was advised by KPMG, Ashurst, Consulting Engineers. Taweelah IWP is Clifford Chance. The sponsors were advised and Mott MacDonald. ACWA Power was expected to begin commercial operations in by Alderbrook Finance, SMBC, Allen & advised by Covington & Burling, and the October 2022. Overy, and Tribe Infrastructure Group. lenders were advised by Allen & Overy.

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