Welcome to the 2019 Thomson Reuters Project Finance International (PFI) Yearbook. The Yearbook is our annual publication in which we look at the events of 2018, through case studies and the PFI Awards, and look forward into 2019 with interviews and articles in the Global section of the book.
Global Bank of the Year – MUFG MUFG has had another stellar year in the global project finance asset class – topping the loan league tables, currently second in the bond lead manager tables, and finalising some high-profile advisory mandates. For this track record, it is named Bank of the Year.
In only seven years Stonepeak was able to build on relationships made at Macquarie and Blackstone to raise three funds and invest in some assets that are well known in project finance. By Alison Healey.
Dalmore Capital, the UK-based independent fund manager, has had a busy year in acquisitions and fund raising. Following the final close of its third fund and a flurry of deals, it is now looking towards consolidation. By Peter Collins.
Since its founding in 1923 Norinchukin has looked onshore for its investments, but it has begun to branch out overseas and into the project finance lending market as a means to diversify its investment base and to enhance returns. ByJonathan Rogers.
By the time DONG Energy sold its interests in fossil fuels and became Orsted, it had already tied its future to that of wind power. The company had long harboured an ambition to be the world’s biggest player in an asset class with the potential to become one of the world’s pre-eminent sources of power. It has now realised that ambition, and its dominance looks set to grow. By Solomon Teague.
More than 104GW of offshore wind capacity is currently operational or in the planning and development phase globally, representing an increase of over 10% on 2017. Within a very short space of time, the levellised cost of electricity (LCOE) from European offshore wind farms has dropped from above €150/MWh to around €55/MWh. By Simon Luby, global head of due diligence, K2 Management.
Technological advancement is rendering offshore wind power an increasingly viable energy source worldwide. By some estimates, the market could grow at a 16% compound annual rate from 2017 to 2030, as falling manufacture and installation costs allow untapped potential for offshore wind farms to be exploited1. By Luisina Berberian, associate director,S&P Global Ratings.
While the majority of installations are still based in the North Sea, offshore wind farms are now being established all over the world, from storm-tossed Taiwan to the US east coast. As offshore wind continues to grow, however, investors are faced with new risks to tackle. By Robert Bates, underwriter at GCube.
Power purchase agreements with corporate and industrial buyers have catalysed the development of renewable energy in the United States. By Giji M John, partner, Houston office, Orrick Herrington & Sutcliffe LLP1.
Global warming arguably represents an existential threat to international oil companies. As the world weans itself off oil, companies that have made billions selling it will come under increasing pressure. But oil companies are already making changes they hope will ensure they remain relevant in the low-carbon economy. BySolomon Teague.
Throughout 2018, gas producers have been basking in prices that make producing LNG look much more attractive than it has for the previous two years. By Trevor Sikorski, head of natural gas and carbon, Energy Aspect.
As global demand for power continues to grow, so too does the need for new approaches to providing such power. There are a number of reasons why gas-to-power projects should be an important part of the solution to meet this global demand. However, the pace of such projects reaching the market has been much slower than many expected. ByMatthew Brown, partner,Latham & Watkins.
In its latest strategic energy plan, released in July 2018, the Fifth Strategic Energy Plan, the Government of Japan confirmed its overall goal of decarbonising Japan’s energy mix by 2050. By Joseph Kim, partner, Michael Lynch, senior associate and Chiyokazu Shindo, senior associate, Hogan Lovells, Tokyo office.
Americas Bank of the Year Natixis Natixis was the stand-out bank in the Americas for 2018 largely due to its key role in the evolution of Latin American project finance. The bank was involved in a number of the major Latin American transactions, including Enel Green Power’s landmark solar portfolio financing in Mexico, the Cerro Dominador financing, and the first financing backing a major mine project since the re-emergence of the sector this year in Lundin Gold’s deal backing the Fruta del Norte project.
Financial close for the Gordie Howe International Bridge represented a unique milestone for both Canadian and US P3s. The deal’s success followed many years of challenges. By Alison Healey.
The new Howard County Circuit Courthouse design-build-finance-operate-maintain (DBFOM) project is the first availability-payment structured municipal public-private partnership (P3) to reach financial close in the US, outside of the Governor George Deukmejian Courthouse in Long Beach, CA. By Brian Dugan, managing director, and Brandy Alles, marketing manager, at Edgemoor Infrastructure & Real Estate.
Capital Dynamics manages money and assets across a number of sectors but the group is increasingly focusing on renewable power. By Nic Stone.
Glenfarne Group has emerged from relative obscurity to landing a huge capital injection to grow its business in 2018. A compelling story and first-of-its-kind financing strategy helped. By Nic Stone.
The recent election of President Andrés Manuel López Obrador, affectionately known as AMLO, will bring populist considerations into all aspects of Mexican energy sector policy-making for the next six years. By Dino Barajas, partner, Akin Gump Strauss Hauer & Feld LLP.
Asia-Pacific Bank of the Year SMBC The Asia-Pacific region is Japan’s backyard, and despite the noticeable crouching of the Chinese funds, the Japanese banks and institutions remain active and continue to play a dominant role.
The Jawa 1 integrated LNG-to-power project (Jawa 1), which comprises the integrated financing of a 1,760MW (net) greenfield IPP and a new-build FSRU, secured its project financing in October 2018. By Ginanjar Sofyan of PT Pertamina Power Indonesia, Akira Suda, Takeshi Minowa, Victor Choi of Marubeni Corporation,Yohei Oishi of the Japan Bank for International Cooperation, Mineto Inoue ofNippon Export & Investment Insurance, Yuichiro Yoi of the Asian Development Bank, Adrian Lian and Ron Leonardo of ING Bank NV and Bill McCormack, Lachlan Clancy, Jean-Louis Neves Mandelli of Shearman & Sterling LLP.
In March 2018, another milestone was reached in the Indonesian geothermal sector – the 98.4MW Rantau Dedap geothermal power project in South Sumatra, Indonesia reached financial close on a US$539m limited recourse facility provided by the Asian Development Bank (ADB), the Clean Technology Fund administered by ADB, Japan Bank for International Cooperation (JBIC), Nippon Export and Investment Insurance (NEXI) and a consortium of commercial bank lenders. By Joseph A Bevash, partner, Stephen P McWilliams, partner, Clarinda Tjia-Dharmadi, partner, Tim G Fourteau, counsel, and James S Franklin, senior associate,Latham & Watkins.
After four years in the making, the first commercial waste-to-energy project in Australia has achieved financial close. Opportunities and challenges lie in store for waste-to-energy in Australia. ByRob Watt, partner, Jamie Guthrie, senior associate, Zac Kedgley-Foot, associate, Jessica O’Sullivan, lawyer and Saurabh Narain, lawyer, Allens.
The rise of renewable energy in Australia shows no sign of abating, with the financial closing of the Sunraysia solar farm project breaking new ground in this increasingly competitive market for developers and investors. By Rob White, partner and Lisa Koch, senior consultant, Norton Rose Fulbright Australia.
There has been growing interest among institutional investors in the infrastructure sector, as infrastructure investments can deliver predictable long-term cashflows and show a low correlation with other investments. By Premod Thomas,Audra Low, Nicholas Tan andTed Low of Clifford Capital Pte Ltd.
Europe Bank of the Year – Santander Banco Santander vigorously expanded its project finance lending with an impressive mix of infrastructure and energy deals in Europe during 2018. The Spanish bank stood out thanks to the breadth and type of financing and advisory work.
Middle East Power Deal of the Year – Sakaka The 300MW Sakaka solar project set a range of important precedents in the global project finance market. The deal was won at a record low tariff at the time of bidding, US$0.02341/kWh, it was the first deal in the potentially huge Saudi renewables programme, and it was one of the first sole underwrites in the Gulf market for some time.
On October 17 2018, the project financing of the €1bn Blankenburg Connection near Rotterdam, the Netherlands, reached financial close. It will be financed by a public-private partnership (PPP). By Daphne Broerse and Annemarie Creutzberg, Norton Rose Fulbright LLP.
The roll-out of Open Fiber’s Italian ultra-broadband network has taken off thanks to a landmark €3.5bn financing. By Ottaviano Sanseverino, partner and head of the Energy and Infrastructure department and Arrigo Arrigoni, managing associate, at Gianni Origoni Grippo Cappelli & Partners.
Solar PV portfolios in Italy are getting bigger and require increasingly larger debt financings. Portfolio refinancings and acquisitions bring unique sets of challenges for sponsors and lenders but solutions have been found. By Carloandrea Meacci, partner and head of energy Italy, Ashurst.
The expected closing in December 2018 of the Dubai Electricity & Water Authority’s US$4.3bn, 950MW Solar CSP and Solar PV IPP has truly reset the bar as far as global solar energy procurement is concerned. Atanu Das, vice-president, Yunhe Lu, director, Haoyong Chen, senior manager, and Alan Lau, manager of ACWA Power’s acquisitions and project finance team provide an assessment of the transaction.
Years of economic prosperity, population growth and rapid urbanisation have led to the nations comprising the Gulf Cooperation Council (GCC) becoming some of the highest (per capita) producers of municipal solid waste (MSW) in the world. By Iain Elder, Europe and Middle East Project Development & Finance Team Leader,Ibrahim Bakhurji andSam Ogunlaja, senior associates in the project development and finance practice, Shearman & Sterling.
The Indorama Eleme Fertilizer & Chemicals Ltd (IEFCL) Line 2 expansion financing is a landmark financing for Nigeria and Africa and demonstrates the depth of liquidity in the market for well-structured transactions with borrowers and sponsors that have a proven track-record of performance. By Gareth Hodder, partner, and Deji Adegoke and Dann Irving, senior associates, White & Case.
The Private Infrastructure Development Group (PIDG) has been filling a gap in emerging infrastructure markets, entering risky and unbankable projects and making them viable. The organisation is a pathfinder for private investors and, following a corporate restructure earlier this year, is looking to make an even bigger impact. ByPeter Collins.
It was interesting to note where the first ever cargo from Russia’ Yamal LNG showed up - Boston, USA. Given the current political stand-off between the two countries, with the US imposing heavy energy related sanctions on Russia, the ultimate destination of the LNG hit the headlines earlier this year.