Orrick Advises DFIs on $120 Million Financing of Sainshand Wind Farm in Mongolia

September.01.2017

Deutsch: Orrick berät Entwicklungsbanken bei 120 Millionen US-Dollar Finanzierung des Sainshand Windparks in der Mongolei 

A cross-border Orrick team of lawyers in Paris, London, Munich and Beijing advised European Investment Bank (EIB), European Bank for Reconstruction and Development (EBRD), Denmark’s Export Credit Agency EKF and German bank Nord/LB on the $120 million debt and equity financing of a 54MW onshore wind farm in the Sainshand region, Mongolia.

Sponsored by France’s ENGIE, German project developer Ferrostaal and the Danish Climate Investment Fund (managed by the Investment Fund for Developing Countries), the project’s long-term financing will be provided by EIB and EBRD. The debt funding of $78.5 million comprises EIB funding of $47 million (the first tranche of which will be guaranteed by EKF) and EBRD funding of $31.5 million. Wind turbines are to be provided by Vestas of Denmark with CMEC of China providing balance of plant services.

Once operational (construction is expected to be completed before the end of 2018), the Sainshand wind farm will make a significant contribution to reducing Mongolia’s carbon emissions and enlarging Mongolia’s renewable energy capacity towards achieving Mongolia’s objective of renewable energy accounting for 20 percent of all power by 2020, and 30 percent by 2030.

The Orrick team was led by Simon Ratledge in Paris and included partners John Deacon (London), Timo Holzborn (Munich) and Betty Louie (Beijing), counsel Nikita Tkatchenko (Düsseldorf) and associates Jonathan Desplanque, Matthew Stott and Angela Wallace. Mongolian law firm MahoneyLiotta advised the lenders on local law aspects.

Simon commented “Orrick is delighted to have advised the international financing institutions on this major renewables financing. Renewable technologies continue to be a major driver for our Energy practice and this cross-border transaction demonstrates the team’s ability to drive transactions effectively to close even in the most challenging jurisdictions. Reaching close on this transaction bears witness to the dedication and tenacity of both lenders (EIB, EBRD and EKF) and sponsors (Engie, Ferrostaal and DCIF).”

Norton Rose Fulbright LLP advised the sponsors, with law firms from Belgium, Denmark, Germany, Luxembourg, China and Singapore also being involved in the transaction reflecting the geographical diversity of the sponsor group and the subcontractors.