“Bahamondez, Shearman and Guerrero help GNL Quintero to expand”
Latin Lawyer, by Joe Rowley
Bahamondez, Alvarez & Zegers has helped GNL Quintero redraft a previous project financing agreement to expand facilities at its regasification terminal in Chile, as the falling price of gas and stricter emissions targets has led to increased demand in the country.
Taking 10 months to negotiate, the complex deal required legal counsel to amend contracts relating to an original US$1.1 billion project financing obtained in 2008 and earmarked for the development of the terminal.
The latest deal closed on 25 July. Guerrero, Olivos, Novoa y Errázuriz Abogados in Chile and Shearman & Sterling LLP advised the lenders, having assisted in the original loan.
GNL Quintero, a joint venture between ENAP, Endesa, Metrogas and until recently BG Group (the company is now selling its stake in the project), turned to Bahamondez Alvarez to advise on the expansion of the terminal and truck loading facilities, whose capacity is set to increase by some 50 per cent. “This project has been the result of the energy demand and how the markets have evolved since seven years ago when we first started to develop the project,” explains Bahamondez Alvarez partner Cristián Araya. “Now, due to environmental reasons and the falling price due to the discovery of shale gas in the US, everyone is looking at the market as an attractive one.”
Three years ago, GNL Quintero relied on Larraín y Asociados to gain approval from its lenders – Banco Santander, Banco Español de Crédito, WestLB, Fortis (since merged with BNP Paribas), ING Capital, BBVA, Calyon, Mizuho, Intesa Sanpaolo and BG Group – for the addition of a truck loading facility to the LNG terminal.
For Guerrero Olivos associate Macarena Ravinet, BG selling its stake in the project added a further complication because the documents had to be redrafted to reflect the fact that there would be a new gas-buyer. Carey is advising BG on the divestment.
Upon completion, the terminal will see its capacity increase from 358,900 to 538,350 MMBtu per day.
Counsel to GNL Quintero
Bahamondez, Alvarez & Zegers Ltda.
Partner Cristián Araya and associates José Tomás Ureta and Nicolás Vial
Counsel to the lenders
Shearman & Sterling LLP
Partner Cynthia Urda Kassis and associate Christopher Dolan
Guerrero, Olivos, Novoa y Errázuriz
Partner Roberto Guerrero and associate Macarena Ravinet