| Besting other project financing deals by a considerable margin, the Ichthys LNG project, a joint venture between Australian and Japanese consortiums for the supply of energy, was the largest of its kind in history. Allen & Overy represented Ichthys LNG Pty Ltd and joint venture partners on the development and financing of the integrated LNG project and Allens advised the sponsors of the project: Inpex Corporate and Total SA, Tokyo Gas, Osaka Gas, Chubu Electric Power and Toho Gas. Hogan Lovells represented JKC Australia LNG (a joint venture between Japan’s JGC Corporation, Houston-based KBR and Japan’s Chiyoda Corporation.) Ashurst’s team in Tokyo advised Ichthys LNG Pty Ltd. Latham & Watkins and Herbert Smith Freehills acted for the syndicate comprising 32 lenders.
The value of the transaction is a testament to its significance at a staggering US$34 billion, whilst the project financing was secured and finalised at US$20 billion. The project constitutes a ground breaking transaction also because it amounts to the largest construction project ever initiated Down Under. Australia will become the world’s paramount LNG producer in a strategic venture which will enable Japan to become a recipient of the energy supply at a crucial time: post the devastating March 2011 earthquake and tsunami. Amounting to the world’s weightiest financing package “since ExxonMobil’s US$14 billion financing of its LNG project in Papua New Guinea in March 2010,” according to Allens partner Tim Lester, it is anticipated that the Ichthys project will produce 8.4 million tonnes of LNG and 1.6 million tonnes of LPG each year. The production and processing of the gas and field condensate will take place at the eponymous Ichthys Field which is located about 230 km offshore Western Australia. The gas will then be exported to onshore processing facilities in Darwin via an 889 km subsea pipeline before the extraction of LPG can take place. Commenting on the landmark project, Rupert Burrows from Ashurst stated “Running so many negotiations in parallel was challenging but everyone pulled together to meet the required project timeline.” The Allen & Overy Tokyo team was driven by partner Aled Davies and partner Osamu Ito whilst its Australian team was led by Sydney partner Chris Rushton. Allens’ core team comprised Tim Lester, Stephen Spargo and Ben Farnsworth as well as Adrian Chek, Larry Magid, Grant Cathro, Igor Bogdanich and Jodi Reinmuth. Project finance partner Scott Tindall and Tim Hill led the charge from the Hogan Lovells team. Ashurst’s team was guided by energy partner Rupert Burrows (assisted also by partners Matthias Schemuth and Philip Thomson.) Latham & Watkins Tokyo partner Joseph Bevash managed their team whilst the Singapore group was piloted by partner Stephen McWilliams, bolstered additionally by London partners Bill Voge and Matthew Brown. Herbert Smith Freehills’ involvement was spearheaded by partner Brendan Quinn and Sydney partner Joel Rennie. |
