Setting the table for a new wave of renewable energy and sustainable infrastructure projects in Latin America, law firm Milbank, Tweed, Hadley & McCloy has represented the Inter-American Development Bank in providing a US$200 million revolving credit line to Abengoa S.A. of Spain. The funds are intended to finance development of a host of renewable energy-related projects across Latin America.
According to IDB, the credit line could facilitate development of new infrastructure and renewable energy projects worth an estimated US$1.2 billion over a six-year period, primarily in Brazil, Chile, Mexico and Peru.
In addition to funding power transmission and generation ventures – especially from renewable sources – Abengoa will develop projects designed to improve water quality and sanitation in the region. In its early stages, the loans will fund environmental and social impact studies undertaken by Abengoa, as well as acquisition of land, initial construction, purchase of equipment and machinery, and expenses related to a pilot solar energy initiative.
Headquartered in Seville, Spain, Abengoa is one of the world’s leading renewable energy, infrastructure and environmental services firms.
“The financing paves the way for Abengoa’s further expansion of renewable energy projects in some of the largest and fastest growing economies in Latin America,” said Milbank Project Finance partner Daniel Bartfeld, who led the financing on behalf of IDB. “This transaction illustrates IDB’s commitment to support renewable energy in this region, as well as Abengoa’s continued commitment to bring its world-class renewables experience to the region. We are honored to have advised the Inter-American Development Bank in structuring this facility.”
Milbank has worked on a number of major energy financings in Latin America recently. In May, the firm advised a group of international lenders in providing a $225 million loan to develop the largest wind-power project in Chile, known as El Arrayán. Also last month, Mr. Bartfeld led a team advising international lenders in a $378 million loan to finance a 237-mile pipeline in Chihuahua, Mexico that will bring U.S. natural gas supplies to several Mexican states (Chihuahua Pipeline Project). When completed, the pipeline will be a critical piece of Mexico’s power grid.
