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Latin infra debt: Adjusting the risk balance
Latin infra debt: Adjusting the risk balance
Tom Nelthorpe
25 January 2019

Two historical deals have cast a long shadow in capital markets financing for infrastructure in Latin America, but governments are starting to look beyond them. Is the Latin infra space ready for a shake-up in what has become the norm for balance of risk between investors, lenders, sponsors and governments?

Red Oak: Switching cost of debt in US power
Red Oak: Switching cost of debt in US power
Tom Nelthorpe
10 January 2019

Morgan Stanley Infrastructure’s recent refinancing of the Red Oak power plant took the asset out of the bond market and into the bank market via a ‘hedge toggle’ structure. Twenty years on from Red Oak’s first financing, the US is still searching for workable power market structures. Could the ‘toggle’ help US power sponsors live with market uncertainty?

Liquid, not hot, air: Long-term debt for long-term storage
Liquid, not hot, air: Long-term debt for long-term storage
Tom Nelthorpe
19 December 2018

UK-based developer Highview Power thinks that renewables’ increased share of generation will make its liquid air storage technology increasingly attractive. But long-term debt will be vital to rolling it out.

What price non-recourse debt for US offshore wind?
What price non-recourse debt for US offshore wind?
Tom Nelthorpe
12 December 2018

Balance sheet capacity and strong banking relationships are the best chance the US has of making progress in offshore wind development. While both developers and lenders are accepting compressed returns, there’s still little concrete evidence of the emergence of a creditworthy US supply chain.

What price non-recourse debt for US offshore wind?
What price non-recourse debt for US offshore wind?
Tom Nelthorpe
12 December 2018

Balance sheet capacity and strong banking relationships are the best chance the US has of making progress in offshore wind development. While both developers and lenders are accepting compressed returns, there’s still little concrete evidence of the emergence of a creditworthy US supply chain.

Bujagali Energy: An unlikely DFI debt rollover template
Bujagali Energy: An unlikely DFI debt rollover template
Tom Nelthorpe
12 September 2018

In July, Sithe and IPS refinanced the Bujagali hydro project to deliver a cheaper power tariff to the Ugandan government. The process – a rare refinancing for DFIs – also involved a reshuffle of Bujagali’s debt and equity cast. So is this the beginning of a new willingness from DFIs to roll over debt?

Bujagali Energy: An unlikely DFI debt rollover template
Bujagali Energy: An unlikely DFI debt rollover template
Tom Nelthorpe
12 September 2018

In July, Sithe and IPS refinanced the Bujagali hydro project to deliver a cheaper power tariff to the Ugandan government. The process – a rare refinancing for DFIs – also involved a reshuffle of Bujagali’s debt and equity cast. So is this the beginning of a new willingness from DFIs to roll over debt?

Bayfront Infrastructure: Project CLOs old school style
Bayfront Infrastructure: Project CLOs old school style
Tom Nelthorpe
6 August 2018

Singapore’s Clifford Capital has closed its first securitisation, and is preparing a second, in a bid to establish an infrastructure CLO franchise. Backed by loans from multiple banks, the structure owes more to the securitisation pioneers of the 1990s than more recent synthetic deals.

Bayfront Infrastructure: Project CLOs old school style
Bayfront Infrastructure: Project CLOs old school style
Tom Nelthorpe
6 August 2018

Singapore’s Clifford Capital has closed its first securitisation, and is preparing a second, in a bid to establish an infrastructure CLO franchise. Backed by loans from multiple banks, the structure owes more to the securitisation pioneers of the 1990s than more recent synthetic deals.

Fruta del Norte: Lundin Gold’s multi-sourced debt debut
Fruta del Norte: Lundin Gold’s multi-sourced debt debut
Tom Nelthorpe
27 July 2018

Ecuador’s rehabilitation in financing markets begins with a complex deal for Lundin Gold’s Fruta del Norte mine. The financing combines a stream, a prepay, commercial PRI and a rare raw material guarantee from Finnvera.

Fruta del Norte: Lundin Gold’s multi-sourced debt debut
Fruta del Norte: Lundin Gold’s multi-sourced debt debut
Tom Nelthorpe
27 July 2018

Ecuador’s rehabilitation in financing markets begins with a complex deal for Lundin Gold’s Fruta del Norte mine. The financing combines a stream, a prepay, commercial PRI and a rare raw material guarantee from Finnvera.

KentuckyWired: Testing the line for appropriations risk
KentuckyWired: Testing the line for appropriations risk
Tom Nelthorpe
17 July 2018

A near-death experience for Kentucky's debut US broadband PPP due to rising costs highlights the pitfalls to sponsors of states’ budgeting processes. But PPPs for US broadband will remain tempting.

KentuckyWired: Testing the line for appropriations risk
KentuckyWired: Testing the line for appropriations risk
Tom Nelthorpe
17 July 2018

A near-death experience for Kentucky's debut US broadband PPP due to rising costs highlights the pitfalls to sponsors of states’ budgeting processes. But PPPs for US broadband will remain tempting.

LAX People Mover: Bringing private investment into US airports
LAX People Mover: Bringing private investment into US airports
Tom Nelthorpe
19 June 2018

The private activity bond for a new light rail facility at Los Angeles International Airport (LAX) finds a role for a bond insurer, and a role for PPP in developing public airports in the US.

Paradise gained: MPC Capital’s second-mover advantage
Paradise gained: MPC Capital’s second-mover advantage
Tom Nelthorpe
12 June 2018

Having just reached financial close on a DFI-backed deal for the Paradise Park solar project in Jamaica, German asset manager MPC is carving itself a reputation as an intelligent co-investor in developing renewables projects in niche markets. The firm takes a second mover approach, but learning from others pathfinder deals does not mean it is any less hands on says managing director Martin Vogt.

Freeport train 3: Refinancing to avoid Toshiba's nuclear fallout
Freeport train 3: Refinancing to avoid Toshiba's nuclear fallout
Tom Nelthorpe
31 May 2018

The holding company refinancing for Freeport LNG train 3 shows that banks have not soured on US LNG. But troubled offtakers may force sponsors down less palatable financing routes.

Freeport train 3: Refinancing to avoid Toshiba's nuclear fallout
Freeport train 3: Refinancing to avoid Toshiba's nuclear fallout
Tom Nelthorpe
31 May 2018

The holding company refinancing for Freeport LNG train 3 shows that banks have not soured on US LNG. But troubled offtakers may force sponsors down less palatable financing routes.

Hyflux: Turning its back on power – but is it too late?
Hyflux: Turning its back on power – but is it too late?
Tom Nelthorpe
29 May 2018

An expensive and unsuccessful gamble on Singapore’s deregulated power market has forced water project developer Hyflux into a painful restructuring. It may also have put paid to Hyflux’ overseas ambitions.

Sergipe: Real progress on local currency project bonds
Sergipe: Real progress on local currency project bonds
Tom Nelthorpe
21 May 2018

Is the local currency bank-bond financing for CELSE’s LNG-to-power project an easily repeatable template that will make ECA bond wraps take off? Almost.

Cometa Energia: Actis learns a lesson in Mexican energy reform
Cometa Energia: Actis learns a lesson in Mexican energy reform
Tom Nelthorpe
27 April 2018

The bond refinancing of Actis’ acquisition of InterGen Mexico was pitched as a safe play in Mexico’s evolving energy sector. But reform, politics, and the assets’ age, all made the deal a challenging sell.

PRICO Solar: Giving Gaza another go
PRICO Solar: Giving Gaza another go
Tom Nelthorpe
20 April 2018

The DFI-backed debt for the 7MW PRICO rooftop solar project – only the second power project financing to close in Palestine – is still going to be disbursed despite fresh outbreaks of violence in Gaza. But given its limited impact in meeting growing power demand in Gaza, and the past example of the Gaza Power financing, should it be?

Tè Power: Plastering over the costly cracks in Guinea's power market?
Tè Power: Plastering over the costly cracks in Guinea's power market?
Tom Nelthorpe
13 April 2018

The five-year development finance institution (DFI) funding package for a new oil-fired plant in Guinea might go some way to alleviating the country’s chronic power shortages. But is Endeavor’s Tè a sustainable solution?

Trump’s toll road bonanza
Trump’s toll road bonanza
Tom Nelthorpe
26 March 2018

In an otherwise modest series of proposals for US infrastructure are some measures that might increase the number of brownfield assets coming to market. But states – which will have to do most of the heavy lifting under the plan – will need to get on board.

All in the wrapping: Sirius gets serious about UK guarantee
All in the wrapping: Sirius gets serious about UK guarantee
Tom Nelthorpe
6 March 2018

The UK Guarantee Scheme was not designed for financing mining projects. But Sirius Minerals, which has already overcome significant hurdles to its North Yorkshire polyhalite project, is making a bid to use it for a wrapped bond.

Energoatom’s Opic-wrapped bonds: A post-ECA gift to borrowers?
Energoatom’s Opic-wrapped bonds: A post-ECA gift to borrowers?
Tom Nelthorpe
21 February 2018

Ukraine’s state-owned nuclear generator has closed a bond issue for a nuclear waste storage project at a cheaper rate than its parent, thanks to a first-of-its-kind insurance policy from Opic. Could this wrap edge out conventional ECA debt, or are there still gaps in the structure?

Solar revenue puts: De-risking to depress DSCRs
Solar revenue puts: De-risking to depress DSCRs
Tom Nelthorpe
9 February 2018

Coronal Energy’s hedge on a 30MW PV portfolio was not a textbook use of kWh Analytics’ new solar revenue put. But it might be having the desired effect on banks’ term sheets.

It's a wrap: InfraCredit debuts with Viathan bond
It's a wrap: InfraCredit debuts with Viathan bond
Tom Nelthorpe
7 February 2018

Donor-backed bond insurer InfraCredit has wrapped its first issue – a N10 billion local currency bond for a Nigerian captive power developer. What are the long-term project bond prospects for emerging markets monolines?

Ituango Hydro: Stretching EPM’s funding base
Ituango Hydro: Stretching EPM’s funding base
Tom Nelthorpe
31 January 2018

Colombia’s EPM finally has a long-term debt package in place for the Ituango hydro project. The deal demonstrates a significant broadening of EPM's lender base beyond DFIs and domestic banks.

Time for more Basel-friendly project loan CLOs?
Time for more Basel-friendly project loan CLOs?
Tom Nelthorpe
25 January 2018

The latest revisions to Basel III are generally good news for banks. But they’ll still have to do more to manage their project finance loan books.

Basel III: Expanding the multilateral circle
Basel III: Expanding the multilateral circle
Tom Nelthorpe
16 January 2018

The December 2017 finalisation of the Basel III framework offers some good risk weighting news for smaller multilaterals. Could this help channel more funding to emerging markets?

Chasing paper: PPC’s receivables securitisation
Chasing paper: PPC’s receivables securitisation
Tom Nelthorpe
19 December 2017

The restructuring of Greece’s power sector continues with a novel proposal to monetise PPC customer receivables. If the deal happens, it is likely to be one of the first corporate receivables securitisations in Greece.

Brightline: Take your seats
Brightline: Take your seats
Tom Nelthorpe
14 December 2017

With few exceptions, US travellers have little love for inter-city rail travel. Having pulled off a $600 million non-investment grade PAB issue for its Brightline private railroad project, can hedge fund Fortress get the necessary passenger volume to meet investor expectations?

Batteries not included: Is energy storage bankable?
Batteries not included: Is energy storage bankable?
Tom Nelthorpe
11 December 2017

A clutch of Canadian battery storage deals suggests that non-recourse financing is available for developers – but at a price.

Nacala Logistic Corridor: a private-private partnership
Nacala Logistic Corridor: a private-private partnership
Tom Nelthorpe
1 December 2017

The largest infrastructure project financing in Africa to date, the complex dual-jurisdiction set of agreements for the $2.7 billion Nacala rail financing has lessons for African governments in how to collaborate to attract private infrastructure investment and ECA backing.

Islamic PPPs: What's holding the market back?
Islamic PPPs: What's holding the market back?
Tom Nelthorpe
21 November 2017

The World Bank and the Islamic Development Bank have issued a report highlighting the potential for Islamic finance in PPP. And untapped pools of capital could boost Islamic sources’ share of the infrastructure PPP finance market. But shariah-compliant structures have yet to prove their reliability when deals go bad.

Corti Wind: A step nearer to non-recourse for Argentina’s RenovAR
Corti Wind: A step nearer to non-recourse for Argentina’s RenovAR
Tom Nelthorpe
3 November 2017

Pampa Energia guaranteed the first international financing for a project under Argentina’s RenovAR programme. But the hybrid project structure is strong enough to support non-recourse debt.

EKF: Out of Teghout
EKF: Out of Teghout
Tom Nelthorpe
26 October 2017

Denmark’s EKF has cancelled a loan for the Teghout open pit copper mine in Armenia on environmental grounds. Is this a signal for ECAs to get tougher?

Top Trump ironies: Donald has a plan
Top Trump ironies: Donald has a plan
Tom Nelthorpe
16 October 2017

Forget twitter and the crassness, Donald Trump has an infrastructure plan that the PPP industry actually likes. But is it workable, and would it pass congress?

Sea Lion: Premier and Rockhopper take a different approach
Sea Lion: Premier and Rockhopper take a different approach
Tom Nelthorpe
2 October 2017

Rockhopper and Premier Oil, the independent operators of the Sea Lion oil field offshore the Falkland Islands, have approached UKEF for a direct loan. Why don’t more independents turn to ECAs?

Nuclear waste with an Opic wrap
Nuclear waste with an Opic wrap
Tom Nelthorpe
22 September 2017

An Opic-wrapped Energoatom nuclear waste storage facility project bond is nearing launch. The enhanced bond will be structured around Ukrainian risk, nuclear risk, and the vagaries of the arbitration process.

Zuma Energia: Post-reform Mexican renewables
Zuma Energia: Post-reform Mexican renewables
Tom Nelthorpe
20 September 2017

Lenders have responded strongly to the new breed of power purchase agreements on offer in Mexican renewables. But the market is only likely to get more merchant. TXF talks to Adrián Katzew, chief executive of Zuma Energia.

Inside Tajikistan’s baffling Rogun bond issue
Inside Tajikistan’s baffling Rogun bond issue
Tom Nelthorpe
15 September 2017

Tajikistan has startled bond investors with its debut Eurodollar issue – a deal designed to finance construction of the 3600MW Rogun hydroelectric power project. But the bigger mystery is why it came to market at all.

I-69: The availability PPP that couldn’t
I-69: The availability PPP that couldn’t
Tom Nelthorpe
25 August 2017

The US state of Indiana has terminated the contract and paid off the bond debt for the I-69 PPP. Was picking a shaky contractor bad luck or bad judgement? And what lessons can be learnt for future US infrastructure financings?

Back to the future: Refinancing launches for Indonesia’s Paiton
Back to the future: Refinancing launches for Indonesia’s Paiton
Tom Nelthorpe
28 July 2017

Indonesia’s economy is in rude health. Which means time for a refinancing for Paiton, the coal-fired power plant that always captures the zeitgeist in Indonesian power.

Toxic gas?: PJM power finance moves into a new phase
Toxic gas?: PJM power finance moves into a new phase
Tom Nelthorpe
7 July 2017

After a burst of greenfield and brownfield financings in the US PJM power pool - a boom fuelled by cheap gas - recent capacity auctions point to a slowdown. Some bankers might soon be reaching for their restructuring handbooks.

Etisalat Nigeria: A lesson in towering currency risk
Etisalat Nigeria: A lesson in towering currency risk
Tom Nelthorpe
27 June 2017

With Etisalat Nigeria ownership on the verge of being handed over to 13 banks, have African mobile and tower operators taken on more FX risk than they can handle?

Smart tracking: ECA and DFI cooperation growing
Smart tracking: ECA and DFI cooperation growing
Tom Nelthorpe
19 June 2017

ECAs and DFIs have long worked together to compensate for poor liquidity in emerging markets - although given their different mandates and loan mechanisms, multi-sourced deals are not always a natural fit. But with new products coming to new markets, collaboration is getting smarter, faster and more sponsor-friendly.

Forever bursting bubbles: Calling a top in infrastructure valuations
Forever bursting bubbles: Calling a top in infrastructure valuations
Tom Nelthorpe
25 May 2017

The sheer volume of equity chasing infrastructure assets is pushing up valuations. But debt markets have a much more limited role in driving them up. Is the infra market really in danger of repeating mistakes of the past?

Northland Power: Gemini and beyond
Northland Power: Gemini and beyond
Tom Nelthorpe
9 May 2017

80bp saved on the margin and minimal costs compared to a new money refinancing, the restructuring of the Gemini offshore wind deal vindicates Northland Power’s original use of a soft mini-perm financing in 2014. But according to CFO, Paul Bradley, it is not just the cost of offshore wind debt that is tightening.

US LNG: Golden Pass or slippery baton?
US LNG: Golden Pass or slippery baton?
Tom Nelthorpe
8 May 2017

Regulatory progress in US LNG has continued to be strong. But doubts about the economics of exports – and the legal underpinnings of supply contracts remain.