Dentons Advised Masdar on Financing for World's Largest Solar Park in Dubai

Dentons Advised Masdar on Financing for World's Largest Solar Park in Dubai

Dentons has advised Masdar on the successful financial closing of the 1,800MW solar photovoltaic independent power project, DEWA Phase VI, located in Dubai. This project marks the sixth phase in the development of the Mohammed bin Rashid Al Maktoum Solar Park, the largest solar park in the world upon completion.

The project will sell its entire power output to Dubai Electricity and Water Authority (DEWA), the sole buyer of power in Dubai, under a long-term Power Purchase Agreement (PPA). Upon becoming operational in stages, the sixth phase will power over half a million residences, reduce carbon emissions by 2.36 million tonnes annually, and contribute to the park's total production capacity reaching 5,000MW by 2030.

Dentons served as a critical partner throughout the entire transaction, guiding Masdar from the initial bid phase to the successful financial close. This comprehensive support encompassed a range of key activities, including navigating negotiations with DEWA, collaborating with the EPC (Engineering, Procurement, and Construction) contractor on a complex contractual arrangement, working closely with the O&M (Operation and Maintenance) contractor, and partnering with a syndicate of financiers to secure the necessary funding.

The financing adopted a dual-tranche syndicated structure, blending conventional and Islamic Ijara elements. Standard Chartered Bank assumed the roles of documentation bank, global agent, conventional facility agent, and account bank. The conventional facility was led by a consortium including Abu Dhabi Islamic Bank PJSC, First Abu Dhabi Bank PJSC (acting as Global Green Facility Coordinator), and HSBC Bank Middle East Limited (acting as Regional Green Facility Coordinator), alongside additional banks. The Islamic facility, meanwhile, was led by Abu Dhabi Islamic Bank PJSC and Warba Bank KSCP. Throughout this process, Dentons provided comprehensive legal counsel, encompassing the negotiation of termsheets, the structuring of financing and security arrangements, and the provision of guidance on hedging strategies to ensure a seamless financial close.

The cross-border Dentons team spanned offices in the UAE, UK, and Ireland, providing comprehensive and continuous service to Masdar. This builds upon their successful financial closing of the DEWA III refinancing in July 2022.

"We are delighted to have supported Masdar on the successful financial close of the sixth phase of the Mohammed bin Rashid Al Maktoum Solar Park. This transaction is a new milestone in the use of clean and renewable energy in the UAE, and another example of Dentons' commitment to helping shape the future of the UAE, in this case in line with the country's National Energy Strategy 2050," Banking and Finance partner Stephen Knight, based in Dentons' Abu Dhabi office, said.

The Dentons team, led by partners Stephen Knight and Colm O'Huiginn, delivered a comprehensive legal effort across multiple practice areas. Supporting them were counsel Graham Richmond, senior associates Kanishka Singh, Annabel Vincent, and Ahmed El-Bayouk, associate Najeeb Gill, legal consultant Nikhil Pareek, and legal assistant Nisha Gupta.

For the hedging workstream, partner Matthew Sapte provided expertise, supported by senior associate Marcus Ang and associate Giuliano Roberti.

Leading the corporate workstream was partner Iain Black, assisted by associates Lamia Al-Lamki and Kislay Kumar, and paralegals Faris Al Ramahi and Manal Abu Issa.