Bakers, Norton Rose among firms on $5.4bn SA renewable energy project

Baker & McKenzie and Norton Rose are among a raft of firms advising on a major South Africa renewables initiative which has seen the country’s government sign deals with 28 independent power producers.

Earlier this week $5.4bn (£3.4bn) worth of contracts between the South African Government, state power provider Eskom and independent power producers were signed after 28 bidders were approved in the first of a three-phase negotiation process.

The deals are expected to reach financial close in the next few weeks, after which construction will begin, with the programme expected to create more than 20,000 jobs.

Contract talks in phases two and three of the initiative will take place during 2013 as the South African Government looks to reduce the country’s reliance on coal and produce as much as 7,000 megawatts of generating capacity through renewables by 2020.

A team from Norton Rose helped secure 14 deals and has already been selected to advise on seven contracts for phase two of the process. A team of four directors from the firm’s Johannesburg office are leading on the deals: Jackie Midlane, Gavin Noeth and Bradley Harber in banking and Julian Jackson from ithe firm’s corporate practice.

Meanwhile, Bakers’ Johannesburg office, led by co-managing office partner Scott Brodsky, advised a range of sponsors and lenders on 13 of the 28 projects selected and has been mandated on projects for round two. The firm’s London office has also provided lawyers on the project due to its scale.

Elsewhere, DLA Piper’s South Africa arm, DLA Cliffe Dekker Hofmeyr, has taken a number of roles including advising on concentrated solar power, wind, hydro and landfill gas projects through its Cape Town and Johannesburg offices, with a team led by director and national head of projects and infrastructure Kieran Whyte. The firm is also acting as co-counsel to Eskom alongside a Johannesburg team from White & Case led by energy partner Shamilah Grimwood.

Brodsky commented: “South Africa has been working towards adding to its power generation capacity while diversifying energy sources for some time now, leading to a complex tender process and the unprecedented legal challenges of signing and closing so many projects simultaneously.”

Whyte added: “This was a very large procurement process even by international terms – 28 projects trying to get to financial close in a short timeframe is unprecedented in this country.”

The South African market is currently attracting much attention from UK and international law firms, with many looking to the emerging market for growth opportunities in fast-rising sectors such as energy as the European markets continue to stagnate.

For more, see Linklaters South Africa alliance move underlines rising interest in region.