Global law firm White & Case LLP advised the joint venture project company, Nord Stream AG, and the sponsors on the construction and financing of phase two of its development of two 1,220 km subsea offshore gas pipelines that will link Russia and the European Union via the Baltic Sea.
"The fact that the financing of phase two of the Nord Stream pipeline project was finalised just nine months after financial close of phase one, and was just as heavily over-subscribed, shows the continued confidence of the international markets in this groundbreaking project. It is also a testament to how we were able to structure phase one to seamlessly integrate the phase two financing," commented Jason Kerr, White & Case partner.
The sponsors on the transaction are OAO Gazprom, E.ON Ruhrgas AG, BASF/Wintershall GmbH, N.V. Nederlandse Gasunie and GDF Suez. The total project costs for both pipelines is in the region of €7.4 billion. The financing of the second pipeline consists of €2.5 billion of debt from the Export Credit Agencies, Hermes and SACE, as well as UFK (Germany’s untied loan guarantee scheme) and a commercial bank syndicate of 24 international banks (21 of whom participated in phase one).
"Our role on both phases of the Nord Stream pipeline project, which has been ongoing for nearly four years and has involved a cross-jurisdictional and multi-practice team, demonstrates our market leading position on structuring and financing complex large-scale projects of this nature," added Jason Kerr.
White & Case advised on all legal aspects of the construction and financing of this project. The construction work included preparation of tender documents, tender analysis, contract negotiations and finalisation of the major construction contracts including the pipelay contracts, the line pipe contracts, coating and logistics contract and valve supply contracts for the pipeline.
With respect to the project financing, the Firm advised on English, Russian and German law aspects of the deal. White & Case also advised on the preparation and development of the long term gas transportation agreement between Nord Stream and OOO Gazprom Export, whereby the entire capacity of the project will be contracted on a ship-or-pay basis. The team has also been involved in environmental aspects of the transaction, as well as other areas such as regulatory, competition and other cross border matters.
The White & Case team was led by Jason Kerr, working with fellow Project Finance partners Philip Stopford, Kirsti Massie (London), Manfred Ungemach (Düsseldorf) and Irina Nesvetova and Maxim Kobzev (Moscow); Construction and Engineering partner, Ellis Baker; and Brussels competition partner, Mark Powell. The team was comprised of more than 30 lawyers drawn from multiple offices, including London, Moscow, Düsseldorf, Frankfurt and Brussels, including Paul Harrison, Tallat Hussain, Kemal Suffee, Nneka Okonkwo, Sajjad Khoshroo, Anastacia Kharitonova, Sam Whitman and Emily Pender.
Anthony Giustini and Nick Wong of Clifford Chance acted as co-lead partners for the ECAs, UFK and the commercial bank syndicate.
For more information please speak to your local media contact.