PLUS PFI LEGAL REPORT 2020 NOVEMBER 18 2020 ISSUE 685 www.pfie.com INSIDE THIS ISSUE… AMERICAS Biden buoys green hopes z AMLO expands infra plan ASIA PACIFIC Telestra/Optus sales due z WestConnex road in refi EMEA Telco infra in vogue z Rv 555 currency risk outstanding LEGAL SURVEY Top firms boost deal numbers 00a Cover.indd 1 17/11/2020 19:42:38 ESG CAPITAL MARKETS WEBCAST The IFR ESG Capital Markets Webcast takes place on the DATES afternoon of Thursday December 3 2020. DECEMBER 3 2020 Moderated by Keith Mullin, Founder & Director of KM TIME Capital Markets, this timely webcast will bring together ×52 a panel of senior market participants to assess current themes in the ESG market. FORMAT WEBCAST Topics covered will include: • &SZUIFYJTSHZWWJSY*8,HFUNYFQRFWPJYXFHYN[NY^d • )NXHJWSNSLIWN[NSLYMJRJXFSIYWJSIXNSLWJJSFSIXTHNFQèSFSHJFSIMT\ HFUNYFQRFWPJYXFWJWJFHYNSLYTYMJRd • 8THNFQèSFSHJYMJRJXHFRJYTYMJKTWJFXYMJ(T[NIHWNXNXJRJWLJI-T\\NQQ YMJNSYJWUQF^GJY\JJSYMJÙ*ÚYMJÙ8ÚFSIYMJÙ,ÚNS*8,HFUNYFQRFWPJYXIJ[JQTU$d • -T\FWJNS[JXYTWXNSéZJSHNSLYMJGJMF[NTZWFSIUJWKTWRFSHJTKNXXZJWXNSYMJ environmental/sustainability capital markets? • What impacts are the various data transparency standards (e.g. Taskforce on (QNRFYJWJQFYJI+NSFSHNFQ)NXHQTXZWJX9FXP+TWHJKTW3FYZWJ7JQFYJI+NSFSHNFQ )NXHQTXZWJX8HNJSHJGFXJI9FWLJYX.SNYNFYN[JMF[NSLTSYMJVZFQNY^TKHTWUTWFYJ *8,WJUTWYNSLFSIINXHQTXZWJ$d • -T\NXYMJ*8,XHTWNSLWFYNSLXFSIJ[FQZFYNTSXNSIZXYW^J[TQ[NSL\NYM IJ[JQTURJSYX$d The webcast is free to join - all you need to do is register at https://tinyurl.com/y3yl7uj7. Sponsored by: Bank Capital Conference 2020 and ESG opportunities.indd 1 11/11/2020 14:26:06 PROJECT FINANCE INTERNATIONAL NOVEMBER 18 2020 ISSUE 685 Contents EDITOR SUBSCRIPTION SALES ENQUIRIES PEOPLE & MARKETS Rod Morrison (London) CHINA, HONG KONG, JAPAN, KOREA, +44 (0)20 7542 8329 TAIWAN rod.morrison@refinitiv.com Alan Wong 3 Enel scouts for green hydrogen +852 2912 6606 ASIA PACIFIC EDITOR Enel is looking at a number of renewable hydrogen Minerva Lau (Singapore) AUSTRALIA, INDIA, INDONESIA, opportunities in Spain, Italy, the US, and Chile +65 6417 4554 MALAYSIA, SINGAPORE, THAILAND minerva.lau@refinitiv.com Samantha Harris +612 9373 1749 4 AMERICAS SENIOR REPORTER Fortescue launches into global green energy Alison Healey (New York) SUBSCRIPTION ACCOUNT MANAGER Australian mining company Fortescue is targeting the +1 (570) 270 4774 Pia Batuan build-out of 235GW of renewables capacity alison.healey1@refinitiv.com +65 6403 5542 LATIN AMERICAS SENIOR REPORTER GLOBAL ADVERTISING PRODUCTION NEWS Nic Stone (New York) MANAGER +1 (646) 223 4110 Gloria Balbastro nic.stone@refinitiv.com +44 (0) 20 7542 4348 AMERICAS AUSTRALIA EDITOR HEAD OF PRODUCTION 10 Renewables sector cheers Biden win Alex Dockreay (Sydney) Clive George Mobile: +61 466 255 412 Biden’s victory in the US election is expected to add ASSISTANT PRODUCTION MANAGER alexandra.dockreay@refinitiv.com Nita Webb rocket fuel to the sector’s growth prospects SENIOR REPORTER SENIOR PRODUCTION EXECUTIVE Jordan Bintcliffe (London) Andreas Michael 17 AMLO to expand infra programme +44 (0)207 5427 144 jordan.bintcliffe@refinitiv.com MARKETING MANAGER Mexico will unveil a second package of infra projects SENIOR REPORTER Paul Holliday following last month’s US$14bn programme Peter Collins (London) SALES HOTLINES +44 (0)20 7542 4327 EMEA ASIA PACIFIC peter.collins@refinitiv.com +44 (0) 20 7542 4569 25 GLOBAL HEAD – ADVERTISING & cmi.emeasales@refinitiv.com Towers sales loom large in Australia SPONSORSHIP SALES Americas Both Telestra and Optus are due to divest their towers Shahid Hamid +1 646 223 5543 portfolios, with both deals expected next year +65 9755 5031 cmi.americassales@refinitiv.com ADVERTISING & SPONSORSHIP !SIA 0ACIlC SALES DIRECTOR cmi.asiasales@refinitiv.com 31 WestConnex set for refi Leonie Welss CLIENT SERVICES A$4bn of debt on the WestConnex road project is +44 (0) 20 7542 7752 IFR.Clientsupport@refinitiv.com coming up for refi with UBS running the process REPRINTS OR LICENCE TO COPY Gloria Balbastro EUROPE, MIDDLE EAST AND AFRICA +44 (0) 20 7542 4348 gloria.balbastro@refinitiv.com 39 Fibre and 5G rule telco market REGISTERED OFFICE Numerous telco deals are underway as investors and 5 Canada Square, companies vie for a slice of the digital goldrush Canary Wharf, London E14 5AQ 44 Registered no. 2012235 FX risk open on Rv 555 road PPP Who will take the currency risk remains open as Vegvesen pushes for the deal to be done in kroner FEATURES 56 Top firms boost deal numbers Covid-19 may have caused a wash-out for much of The contents of this publication, either in whole or part, may not be reproduced, the world’s economy but lawyers of the infrastructure stored in a data retrieval system or transmitted in any form or by any means, industry have been kept busy regardless, with deals electronic, mechanical, photocopying, recording or otherwise without written continuing to close at a good clip. PFI’s Legal Report permission of the pub lishers. Action will be taken against companies or individual persons who ignore this warning. The information set forth herein has been 2020 charts the leading legal practices in the space obtained from sources which we believe to be reliable, but is not guaranteed. and the deals they’ve been working on Subscriptions to Project Finance International are non-refundable after their commencement issue date. © Refinitiv 2020. Printed in England by Walstead Roche Ltd. Unauthorised photocopying is illegal. ISSN: 0967-5914 Project Finance International November 18 2020 1 01 Contents p1.indd 1 17/11/2020 19:54:13 PEOPLE & MARKETS ROD MORRISON Seeking friends for warm thermals Growing numbers of them as there are many power stations that )%#Sû)NDEED ûTHATûWASûTHEûTRADITIONALûMODELûFORû infrastructure investors are still valuable and needed for regions or developing large energy projects to diversify have been on the hunt for COUNTRIES vû+AKINOKIûSAIDû(OWEVER ûHEûADDEDû RISKûnûAûMODELûTHATûISûNOWûBEINGûUSEDûBYû investments for more than a that the company needed to avoid selling the offshore wind farm developers. decade now and the search has STAKESûATûAûLARGEûLOSS ûORûTOûBUYERSûWHOûMAYû Financial investors were not really into the resell them quickly. FARM DOWNûMODELû)%#SûWERE ûDURINGûTHEûLASTû become ever more elaborate #OMPANIESûSUCHûASû-ARUBENI û-ITSUIûANDû DECADE ûSTARTINGûTOûOFmOADûSOMEûINFRASTRUCTURE – from core to non-core with Sumitomo are labelled as trading houses style assets within their portfolios but it was core+, core++ etc in between. BUTûTHEYûARE ûINûEFFECT ûLONG TERMûINVESTORSûnû NOTûSTANDARDûPRACTICEû4HATûIS ûUNTILû!$./#û But now they can go back to particularly in the energy markets. So selling transacted its mega-scale infrastructure oil and basics – thermals. The trading ASSETSûISûNOTûINûTHEIRûNATUREû4HEûCOAL lREDû then gas pipelines sales. Those two deals seems SALESûWILLûNOTûHAPPENûQUICKLY û-ITSUIûSAID ûITû to have heightened interest in the concept. But houses are putting unloved aims to sell its stakes by the end of decade. THEûMAINûFACTORûINûlNANCIALûINVESTORSûBEINGû coal-fired assets on the block Many of these assets are not only strategic invited in is the economic climate this year. but perhaps more interestingly for the investors but for the host countries as &ARM DOWNSûTOûOTHERû)%#SûAREûNOTûATTRACTINGû the oil and gas companies are WELLûnûSAYû-ITSUISû0AITONûSTAKEûINû)NDONESIAû MUCHûINTERESTû)%#SûSHARESûHAVEûBEENûHITûBYû seeking new partners. Not only is a good price required but the #OVID ûANDûMAYBEûGENERALûCLIMATEûCHANGEû most governments will want reliable weariness. &ORûTHEû*APANESEûTRADINGûHOUSESûTHEIRûCOAL lREDû PARTNERSûBOUGHTûINû)NDONESIA ûFORûEXAMPLE û 7OODSIDEûCHIEFûEXECUTIVEû0ETERû#OLEMANû power stations present a problem. They have is still committed to coal deals having signed spelt it out last week. Last year the Australian pledged to reduce their involvement in the THEû*AWAûûDEALûWITHû+EPCOûLASTûWEEK COMPANYûSOUNDEDûOUTû)%#SûTOûBUYûPARTûOFûITSû sector over the next decade but how? Asset sales Warren Buffett can no doubt be called upon ûSTAKEûINûTHEû53BNû3CARBOROUGHûGASû are the most obvious answer but the buyers are TOûGIVEûSOMEû3AGEûOFû/MAHAûADVICEû(EûHASû lELDûTOûRAISEûFUNDS ûBUTûDUEûTOûTHEûOILûANDûGASû not queuing up in the same way they would JUSTûINVESTEDû53BNûINûlVEûOFûTHEûBIGGESTû price crash this year “that no longer makes HAVEûDONEûlVEûORûûYEARSûAGOû4HATûSAID ûTHEû TRADINGûHOUSESûnû)TOCHU û-ARUBENI û-ITSUBISHI û SENSEv û#OLEMANûSAID assets themselves are performing well enough -ITSUIûANDû3UMITOMOûnûBYûTAKINGûûSTAKESûINû h)TSûJUSTûSIMPLYûNOTûAûGOODûTIMEûINûTHEû ECONOMICALLYûINûMANYûMARKETS ûPRODUCINGû EACH û4HEûINVESTMENTûCOMESûATûANûINTERESTINGû MARKETûTOûSELLûTHAT vûHEûSAIDû)NSTEAD ûITûNOWû DECENTûCASHmOWSûETC ûSOûSELLINGûCREATESûANûISSUEû time as the companies’ energy portfolios have WANTSûTOûSELLûAROUNDûAûûSTAKEûINû0LUTOû for shareholder-based companies. BEENûHITûBYû#OVID ûBUTû*APANûASûAûCOUNTRYû 4RAINû ûWHICHûISûSERVEDûBYû3CARBOROUGH ûTOû -ARUBENISûCHIEFûEXECUTIVEûOFlCERû-ASUMIû ISûPERFORMINGûBETTERûTHANûMANYûINûû(ISû infrastructure investors. Kakinoki said last week it is increasingly foray into energy investment last year was just )Nû5GANDA û4OTALûISûSEEKINGûAûSIMILARû DIFlCULTûTOûSELLûSTAKESûINûCOAL lREDûPOWERûPLANTSû ASûINTERESTING û53BNûINû/CCIDENTALûATûû APPROACHûONûITSû53BNû KMû%ASTû DUEûTOûGROWINGûCRITICISMûOFûTHEûPOWERûSTATIONS û to back its Anadarko deal. Oxy’s shares have !FRICANû#RUDEû/ILû0IPELINEû%!#/0 ûFROMûTHEû which emit high levels of carbon dioxide. tumbled this year during