10 | Financing Energy Projects
an internal discipline," tend to cap individual investments around $150 million,
so they are forming small syndicates of
two and three funds in order to spread
the risk and get early stage energy financings done.
Cameron says private equity funds
are also paying for opportunistic acquisitions.
"Clients of ours have participated, as
shareholders, in companies that have
bought chunks of gas properties. Natural
gas prices have been depressed and the
companies that focused in that area have
been inclined to try and sell off assets as a
means to get more efficient. So recently,
for example, Encana Corporation sold
about $500 million of natural gas properties to a company called Endurance —
and Endurance energy LLC is backed by
a couple of private equity funds. They saw
the opportunity to make a good buy under current circumstances.
"We've seen a number of examples of
that. Seasoned management know bargains when they see it, and want to buy
properties now because they think the
price is really attractive to do it — private
equity is going for those kinds of deals."
When it comes to raising capital for
green energy projects, things are a lot
more straightforward.
Large international banks and Canadian life insurance companies such as Manulife, Canada Life and Sun Life, companies that need long-term stable cash flow,
have continued to be very interested in
wind, solar and hydro projects, says David Lever, leader of the Power Group at
McCarthy Tétrault LLP.
"Renewables have had a large uptick
across the country," says Lever. "There
are a number of projects that are in the
financing stage in Québec, Ontario,
Alberta and BC, and we're seeing very
strong appetite."
The European banks, which were
a force in Canada's renewable energy
market before the 2008 credit crisis, are
starting to return. There is some interest from American financial institutions
for lending into the Canadian market.
"And the Asian banks, particularly Japanese banks, have also been investors recently. That's new."
Bank of Tokyo-Mitsubishi UFJ,
Mizuho Bank, Sumitomo Mitsui Banking and JBIC have been involved in renewable energy projects the firm has recently worked on, Lever says.
What's also new is that a small number
of projects have recently been financed
through the private placement of debt.
Lexpert®Ranked Lawyers
Davis, Thomas
R.M. (Tam)
Norton Rose Fulbright
Canada LLP
(514) 847-4857
thomas.davis@
nortonrosefulbright.com
Mr. Davis's business
law practice includes
a focus on electrical
energy. His domestic
and international
experience embraces
project development,
contracts to purchase,
exchange and store
energy, transmission,
distribution and water
management.
DeMarco, Elisabeth
Norton Rose Fulbright
Canada LLP
(416) 203-4431
elisabeth.demarco@
nortonrosefulbright.com
Denstedt, QC,
Shawn H.T.
Osler, Hoskin
& Harcourt LLP
(403) 260-7088
sdenstedt@osler.com
Ms. DeMarco's practice
includes advising
Canadian and foreign
energy and mining
companies and
investment banks on
emissions trading,
project development,
environmental
financing and CSR.
She appears before
the OEB and other
regulators.
Mr. Denstedt practises
environmental,
regulatory and
Aboriginal law in the
energy, mining and
chemical areas. He
appears regularly
before provincial and
federal tribunals and
is co-lead of the firm's
Asian energy initiative.
DeRose, Vincent J.
Borden Ladner
Gervais LLP
(613) 787-3589
vderose@blg.com
Mr. DeRose is the
firm's regional leader
of the Energy Markets
Group and the Oil
and Gas Group. He
represents clients
on natural gas and
electricity regulatory
matters before the
Ontario Energy Board
and the National
Energy Board.
Desbarats, QC,
Robert P.
Osler, Hoskin
& Harcourt LLP
(403) 260-7015
rdesbarats@osler.com
Mr. Desbarats's
practice involves all
commercial aspects
of the conventional
oil and gas, oil sands
and liquefied natural
gas businesses,
including acquisitions
and divestitures, joint
ventures and other
transactions.
Deyholos, Ronald A.
Torys LLP
(403) 776-3718
rdeyholos@torys.com
Mr. Deyholos'S energy
practice engages
infrastructure projects.
His experience
includes advice
on joint ventures,
supply contracts,
and construction and
operating matters in the
oil and gas, oil sands,
cogeneration and wind
power sectors.
