DCM and Energy teams advise on first long-term Green Bond for Noor Abu Dhabi solar PV power generation plant

Norton Rose Fulbright – acting as US federal securities, New York, English and UAE law legal counsel – has advised the underwriters, led by Citi, HSBC and MUFG, in connection with the issuance by Sweihan PV Power Company PJSC (the Issuer) of USD700,800,000 3.625 per cent senior secured amortizing green bonds due 2049. The bonds were issued under New York law and offered pursuant to R144A and Reg S, and will be admitted to trading in Dublin, and included in the list of Euronext ESG Bonds.

The Issuer owns and operates the fully operational Noor Abu Dhabi solar PV power generation plant located in Sweihan, Abu Dhabi, with a contracted power capacity of 881 MW (AC), which generates revenues pursuant to a power purchase agreement with EWEC. The Issuer is indirectly owned by project sponsors – TAQA, Marubeni and JinkoSolar, and the issuance represents one of the first forays into green financing by TAQA. The Noor Abu Dhabi project is one of fourteen EWEC power and water projects, and the project has been identified as a key strategic asset for the Government of Abu Dhabi as it implements its Energy Strategy 2050 to increase the share of renewables in the energy supply mix.

The net proceeds of the bonds will be allocated in accordance with the Issuer’s Green Bond Framework, which is aligned with ICMA’s Green Bond Principles 2021 and the ‘solar energy’ standard of the Climate Bonds Initiative, and includes the refinancing in full of the Issuer’s existing bank debt term facilities and the unwind of certain related swap arrangements.

As a rare green financing of a green (solar) project asset in the Middle East, investor interest for the bonds included high-quality accounts from ESG-focused local, regional and international investors.

The Norton Rose Fulbright team advising the underwriters was led by debt capital markets partner Peter Young and energy project finance partner Charles Whitney.

Peter Young commented, “We were honoured to advise the underwriters on this transaction, and I congratulate the Issuer, sponsors and all stakeholders on this landmark green bond financing. We were able to leverage our leading versatile debt capital markets and US securities law capabilities with project financing expertise and knowledge of the GCC to achieve financial close.”

Charles Whitney commented, “It has been our privilege to advise the underwriters on this, as the sponsors and EWEC take the next step in evolution of the renewables market in Abu Dhabi and indeed the GCC. Our team has advised on the last four EWEC procured projects to achieve financial close, which put us in a unique position to guide the underwriting banks through the documentation and process in Abu Dhabi. Our bond and project finance teams across London and Dubai work regularly together, allowing us to cover our clients seamlessly on a financing with a tight timetable. As one of the first certified green bonds issued in connection with a project financing in Abu Dhabi, we are confident that EWEC, TAQA, Marubeni and JinkoSolar have set a benchmark for other GCC renewable projects seeking to refinance in the bond market going forward.”

The other underwriters were BNPP, First Abu Dhabi Bank and SMBC, with Alderbrook Finance acting as financial adviser to the Issuer. First Abu Dhabi Bank is working capital facility lender to the Issuer.

The London and Dubai teams included Peter Young, Vishal Mawkin, Andrew Coote, Miguel Torres (debt capital markets, London); Charles Whitney, Chris Down and Rahul Medappa (energy project finance, London) and Nick Robinson and Hesa Alsaad (banking, UAE). Paul Mansouri and Jamie Munro (energy project finance, London) and Seya Rahnema and Amnah AlYousif (banking, UAE) acted for the existing lenders (led by MUFG as facility agent), and Kirstin Russell and Jessica Sorah (corporate trustee, London) acted for HSBC in various bond trustee and agency capacities.