Parque Eolico El Arrayan, sponsored by AEI, Pattern Energy and Antofagasta Minerals, has closed on $245m in financing, to support construction of the Chilean wind energy project. The package includes $210m in construction debt, a $15m letter of credit facility, and a $20m subordinated facility to pay value-added tax. The construction loans are set to convert at the completion of the construction into a 15-year term loan. The interest rate has not been disclosed. The project is expected to begin operation in 2014. Bank of Tokyo-Mitsubishi UFJ, Credit Agricole and Sumitomo Mitsui were MLAs, with Corpbanca providing the VAT facility. Danish export credit agency Eksport Kredit Fonden (EKF) provided guaranteed loans through a program it has for promoting exports. Skanska Chile is the contractor building the 115MW El Arrayan, located 250 miles north of Santiago. The farm will supply power to Antofagasta’s Minera Los Pelambres project.
Category: Project & Infrastructure Finance
Mexican Energy Project Plans Bond
SolMex Energy, a joint venture formed by Mexican development company Grupo Musa and US-based renewable energy company Synergy Technologies, is planning to raise funds for a $1bn-plus solar power generation project in Tecate. Currently, SolMex has a commitment from Finexim for the facilitation of $720m in funds, which is expected to cover 200MW, or the first 4 phases. It includes a $160m, 25-year non-callable bond with a fixed interest rate under 5% is expected to cover the 50MW first phase, with expected issuance in the second quarter, through Finexim and BB&T Capital Markets. Other funding sources are also bidding on the project, says a person familiar with the deal, which is being developed in 50MW phases to 450MW total capacity. The SolMex project will start off supplying power for the nearby region, but down the road could sell power to southern California as well. This is Grupo Musa and Synergy’s first project together. Multinational business development firm Asian Pacific Development Corporation is advising on the project and its financing.
Schahin Set for Drillship Bond
Brazil’s Schahin Petroleo e Gas has given 6.0%-area guidance on a $730m bond, expected to price today.The transaction was heard getting around $1bn in demand as of Tuesday afternoon. The BBB minus/Baa3 bond features a 7.5-year average life, with an expected maturity of 2022 and legal maturity of 2023. Proceeds would help refinance a bridge loan for the Sertao ultra-deepwater drillship.The transaction is backed by flows from Sertao’s 10-year service contract with Petrobras, and follows a roadshow that ended Tuesday. Morgan Stanley, Nomura, Deutsche Bank and Mizuho are managing the sale, done through the Schahin II Finance Company special purpose vehicle. Sertao is currently making its way to Brazil from Korea, and is expected to be operational in 3 months.
Chilean Wind Developer Seeks Loan
Chile’s Ecoingenieros is looking for a 15-year, $56m loan to help finance construction of an $80m wind farm, a company official says. The developer expects to talk to banks and look at offers together with investors next month, then seek to raise the money as soon as July. “We are now trying to find the best loan possible to go ahead with the building of the project,” says Carlos Faundez, director for Ecoingenieros. Debt would cover 70% of the cost, with the remainder coming from equity, he says, explaining that they already have an offer from a local bank, and are awaiting two offers from Chinese banks. There are plenty of investors, he says, adding that those involved on the equity side are private investors with a special interest in energy and wind projects. He says he expects to work with either a local bank or a Chinese bank, adding that several of Chinese-made turbines have been sold in Chile already. “We have a good relationship with Chinese banks and Chinese wind turbine manufacturers,” Faundez says. The 40MW Pacifco project is located in the Chile’s Los Lagos region.
OSX Taps BNDES Bridge Funding
OSX, the oil services company controlled by Brazilian billionaire Eike Batista, has received $227.9m in BNDES funding as part of a bridge loan, which will be used to construct the Acu shipbuilding unit in Rio de Janeiro. Principal and interest on the loan, which carries a yearly rate of 5.4%, will be paid on maturity in 18 months or upon the first disbursement of a 20-year USD-denominated loan from the Merchant Marine Fund that carries an interest rate of between 2%-4%. The company’s CFO Roberto Monteiro told LatinFinance late last year that OSX expects to raise $1.7bn from the state-sponsored Merchant Marine Fund to build the shipyard. Funds will be lent through BNDES and Caxia Economico Federal.
Argie Wind Farm Launches Bonds
The Loma Blanca wind project, a unit of Spain’s Isolux, has launched a $103m domestic bond issue in the Argentine market, according to bankers on the deal. The borrower is issuing a $30m 4-year tranche paying a spread to Badlar and a $73m 10-year tranche paying a spread to Libor. Pricing is expected on Thursday through lead Banco Macro. Proceeds will fund the construction of the 200-megawatt wind farm in Chubut province, which includes a $25m investment from Isolux and funding from CAF.
Abengoa Project Preps Bond Takeout
Abengoa Cogeneracion Tabasco (ACT) is heard to be preparing investor meetings this week via Credit Suisse for an up to $600m senior secured 2032 bond, after Fitch and S&P assigned a BBB minus ratings to the offering. The bulk of financing is expected to take-out bank debt, while the remainder will cover construction costs to build a gas fired co-generation plant that will operate within a complex owned by Mexican state-owned oil company Pemex (BBB), which is the sole off-taker. ACT is a special purpose vehicle owned by subsidiaries of Spain’s Abengoa and GE Capital. In 2009, both companies signed a 20-year PPA with Pemex to construct, operate and build the facility that is expected to cost $743.5m, $143.5m of which comes from the sponsors in the form of equity. In 2010, Abengoa closed a $460m 7-year loan to build the 300MW facility through structuring and syndication agent Santander. The facility pays a step-up spread starting at Libor plus 412bp for the 36-month construction period, and rising to 437bp through month 48, 462bp through month 60, and 562bp through month 78. The project is expected to be completed in September next year. According to a person familiar with transaction, about $367m of the bond’s proceeds will pay outstanding bank loans, about $79m will cover an engineering, procurement and construction (EPC) contract, $44m for interest payment during the project construction, $23m for the service reserve account, and $65m for swap termination costs and a letter of credit agreement. As positives, Fitch cites the low completion risks, as well as sponsorship from companies with a strong track record in this area.
OSX Preps $3bn in Project Financing
Brazil’s OSX is preparing some $3bn-plus in financing for 5 FPSO and wellhead platform projects, says Roberto Monteiro, the company’s CFO. The borrower has typically resorted to the loan market, but could look to local development bank BNDES, as well as to bridge or bond financing. Last year, it raised $420m through an 8.5-year loan in October 2010 at Libor+425bp to finance the OSX-1 FPSO. It also just recently closed an $850m 12-year loan which was used to finance the construction of OSX-2 and came at Libor+425bp pre-construction and at 450bp thereafter. “The third FPSO will be financed mid-2012 and we still haven’t defined if it is going to be a syndicated loan or a bridge and then a project bond,” says Monteiro. Meanwhile the wellhead platforms will likely be financed by development banks BNDES and ECA GIEK. “Since they are being built in Brazil, BNDES is interested in financing to promote local content,” he adds. It could be a similar story for OSX 4 and 5, as they will likely be the first FPSOs to be built in OSX’s own yards.
MPX Eligible for BNDES Financing
MPX Energia has taken steps toward securing BRL1.6bn ($880m) in BNDES financing for its Parnaíba Thermoelectric Complex. The project is expected to be funded with about 70% debt and 30% equity, with total investment for constructing 3 facilities expected at about BRL2.3bn. Though MPX is now eligible for the financing, final terms remain subject to approval by BNDES’ credit committee and board of directors. In June, the Brazilian power generation subsidiary of Eike Batista’s EBX family of companies announced it had acquired two power projects from Bertin. MPX does not disclose the value of the acquisition, but says the two projects generate combined revenues of BRL323.8m.
Recope Preps CDB Loan
Costa Rica’s Recope and the China Development Bank (CDB) are working on a 15-year $800m-$900m syndicated loan with a 3-year grace period arranged by CDB to fund improvements at Soresco, a joint refinery venture between China National Petroleum Corporation (CNPC) and Recope, the Costa Rican government says. The Costa Rican national oil refinery has signed a mandate letter with the bank and preliminary financial conditions are being explored, says a person familiar with the agreement, who declined to comment on the interest rate. Soresco, created in 2008, will invest a total of $1.24bn to revamp and expand the Moin-based refinery which will process 60,000 barrels of oil per day. The remaining $300m to $400m will be covered by both partners in equal amounts. Recope plans to issue bonds in the local market in 2012 to finance its share of the deal. As structured, the Soresco joint venture will take care of construction and then lease the facility back to Recope for 15 years with an option to purchase. The lease fee to be paid to Recope will be calculated assuming a 16% IRR for the project.