Foley Hoag Team Closes Renewable Energy Project Financing for Nicaraguan Wind Farm
October 5, 2011
Foley Hoag LLP represented Blue Power & Energy, S.A., a developer of energy projects headquartered in Managua, Nicaragua, as it made its first draw of funds for the construction and permanent financing of the 39.6-megawatt La Fe San Martin wind farm, which is under construction in the Isthmus of Rivas, Nicaragua.
The project, which is expected to cost approximately $110 million, will consist of 22 1.8-megawatt wind turbines. The electrical output from the turbines will be sold to Nicaragua’s two electric utilities, Distribuidora de Electricidad del Sur, S.A. and Distribuidora de Electricidad del Norte, S.A. Deutsche Bank AG will purchase the Certified Emission Reductions certified for the project under the Kyoto Protocol’s Clean Development Mechanism, which will provide additional operating revenue for the project.
The wind farm’s location, the Isthmus of Rivas, is a region in southwest Nicaragua that the country’s Ministry of Energy and Mines has identified for development of its local wind resources. Nicaragua currently relies on diesel and fuel oil for much of its electric power generation.
“This wind farm will help provide additional, clean electric power for the people of Nicaragua,” said Foley Hoag senior partner Paul Bork. “We are proud to have assisted Blue Power & Energy and its outstanding primary counsel, Ivania Guzman and Cesar Arostegui in Managua, on this project.”
Along with Bork, associates Adam Wade and Seth Kipp were primarily responsible for Foley Hoag’s representation in the transaction.
Lenders in the financing included Banco Internacional de Costa Rica, S.A. and the Inter-American Investment Corporation. Citibank, N.A. is acting as the offshore collateral agent governed by New York law, and Banco Lafise Bancentro, S.A. of Nicaragua is acting as the onshore collateral agent governed by the law of Nicaragua.
Blue Power & Energy, S.A. is owned by its project sponsors, Construcciones Lacayo Fiallos, S.A. of Nicaragua, M & Block, S.A. of Panama, and Joaquin Cuadra Lacayo.
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