IFLR 1000
The Guide to the World's Leading Financial Law Firms

After a few difficult years following the financial crisis, business is once again booming for project finance lawyers. An increased interest in renewable energy, prompted by rising fuel prices and promoted by the Obama administration, has provided opportunities domestically. Developments in emerging markets, such as Asia, Latin America and the Caribbean, have created international transactions requiring expertise from US lawyers. "The market is much better this year," says one attorney. "People have crawled out of their shells and are a lot more active in developing new projects." Another partner remarks, "Now is a great time to be in the business."

Firms report an upswing in alternative energy transactions, particularly in the wind sector and in solar projects, where technology is getting cheaper due to competition. "It's not like you're building a gas turbine, where there are only a few manufacturers in the world," one partner notes. However, pressures on the US treasury have created some uncertainty over the future of such projects, which are largely government-funded in the US. One attorney describes the future of renewable energy as "the gentle victim of a violent struggle between budget concerns and those who want to find a solution to our environmental needs."

The deadline for the Department of Energy's Loan Guarantee Program resulted in what one attorney describes as a "sprint to the finish" through most of 2011, as clients scrambled to close deals before the September 30 cut-off. The controversial program, which assures funding for eligible clean energy projects, has been the subject of heated debates between Democrats and Republicans in light of recent budgetary pressures. Lawyers battled against the clock and the program's bureaucratic requirements to get projects approved for their clients. "A friend of mine once said that project finance starts with a dream and then you try to express it in less than 10,000 pages," comments one attorney. "I think there's a lot of truth in that."

Uncertainty over the future of the program has forced lawyers to consider other options for their clients. Although turning to the capital markets for funding is a possibility, particularly to finance international projects, it is a difficult proposition in many cases. "Capital markets don't baby deals like banks do," says one partner. "You can only use the capital markets for projects where you are very confident in your ability to close on time." Additionally, the liquidity of the past year is threatened by the end of QE2, and the fact that there are no immediate plans for a third round of quantitative easing. Some attorneys also expect that world events, such as upheavals in the Middle East and the earthquake, tsunami and nuclear crisis in Japan, may redirect international investment.

The Japanese disaster, which took place in March 2011, has "definitely fuelled the debate over nuclear energy in the US," according to one lawyer. "Six months ago, everyone was gung-ho about nuclear expansion," laments another partner. Whilst existing transactions are generally going ahead, some firms report that the public perception of nuclear power, combined with fiscal limitations, has slowed down the flow of new deals in the sector. "I think there's still some push for nuclear being a source of energy that's relatively clean, but it's almost being pushed off the pages by the deficit discussions here," says a third practitioner.

Latham & Watkins is at the forefront of project finance innovation, and has one of the largest teams in the United States. One peer describes the firm's practice as "very impressive", adding: "they have some fantastic people." In 2010, the firm advised on 46 project finance transactions around the world, with a total deal value of over $34 billion. "Latham is the firm that I see most often," notes another competitor. "They are mostly representing banks or finance providers in deals that I do."

Partner David Gordon is singled out for praise by one rival, who says, "I always think of David as being one of the better project finance partners out there." Partner John Sachs is described by another lawyer as "a well-known name".

The firm acted as common lenders' counsel on the PNG (Papua New Guinea) LNG (liquefiednatural gas) project, an $18 billion natural gas scheme in Papua New Guinea. The scheme, which is the largest-ever project financing, is designed to provide customers in Asia with 6.6 million tons of liquefied natural gas per year, which have been sold under 20-year agreements to Asian buyers. The transaction closed in March 2010.

With an army of more than 100 dedicated project finance lawyers, Milbank Tweed Hadley & McCloy remains a top choice for clients looking to finance complex schemes around the world. "Milbank remains strong and they have continued to do a lot of stuff," says one competitor. Another rival remarks, "Those people know what they are doing."

In June 2010, prominent partner Edwin Feo, described by one rival as Milbank's "number one rainmaker", retired from the firm. Feo, the former co-chair of the firm's energy and project finance practice, went on to become managing director of USRG Renewable Finance, a private equity company specialising in renewable energy. "I think they are big enough to weather it, though," says a rival. "In the short-term they are definitely still top-end. Whether they will stay there is hard to say."

The firm's project finance group continues to retain many star players. Its Washington, DC-based projects group is led by Jonathan Maizel, who peers characterise as "a very experienced project finance lawyer". One competitor, who has sat across the table from Maizel, says, "He did a very good job representing his clients. He's very smart."

Over the last three years, the firm has completed over 140 project financing deals, which raised more than $125 billion for infrastructure projects around the world. These include a first-of-its-kind toll road in Latin America, a wireless telecom build-out in Asia and some of the largest wind and solar farms in the world.

Described by one rival as "great global brand", White & Case is a major player in international energy, infrastructure and project and asset finance. The firm closed $39.5 billion of global project finance transactions in 2010. A competitor says, "They do a tremendous amount of work in emerging markets", and a client remarks, "You get consistency in service if you go to London, New York, Washington or Tokyo."

The firm has an expansive international client base including Hess, Banco Santander, Nuclear Innovation North America, BBVA, and Mizuho Corporate Bank. In April 2011, it boosted its US-based practice by recruiting Elena Millerman, formerly of Debevoise & Plimpton, to its New York office.

"I really appreciate the communication," says one client. "They explain things very clearly in business language, not in legal language, which means a lot. They are also really good at coming to the point and being concise. I enjoy them and have a good working collegial relationship with them, based on mutual respect."

White & Case represented a consortium known as the LBJ Infrastructure Group in a deal which financed improvements to 17 miles of the LBJ Freeway in Texas. The transaction, totalling over $1.4 billion, closed in June 2010 and was the largest-ever private activity bond for a public-private partnership (PPP) deal. It involved a $615 million offering of tax-exempt private activity bonds and the closing of a $850 million loan from the US Department of Transportation.

In April 2011, the firm represented Citigroup Global Markets and Santander Investment Securities as lead arrangers in the $575 million financing of the Alpha Star offshore oil drilling rig. The rig is one of the world's most technologically advanced and is designed to exploit pre-salt deposits in Brazil as part of the Petrobras effort. The transaction involved 14 lenders and parties, and legal issues in Brazil, the UK, the British Virgin Islands, the Netherlands, Panama and the US.

With expertise in biofuels dating back to 1999, Chadbourne & Parke has a particularly strong presence in the US domestic market and is recognised by peers as a go-to shop for renewables. "They have been in that space for quite a while and have both depth and long-time experience," says one competitor. "They have managed to develop a strong practice that has lasted."

The firm suffered a blow in May 2011, when a team led by prominent partners Edward Zaelke and Adam Umanoff left to join Akin Gump Strauss Hauer & Feld. The group also included Thomas Dupuis, Lloyd MacNeil, Kerin Cantwell and Daniel Sinaiko, as well as five counsel and five associates.

However, the firm's lawyers continue to attract praise from peers and clients. Partner Keith Martin was described by one rival as "one of the key people in the energy industry", while a competitor who has worked across the table from Vincent Dunn identifies him as a "very effective" up-and-coming partner. Senior partner Chaim Wachsberger commanded respect across the board. "Chaim has been in the project finance area for a very long time," says one client. "He's very intelligent, very calm under pressure, a good negotiator and very efficient."

In July 2010, the firm represented sponsor Terra-Gen Power, four separate project companies and holding company Terra-Gen Alta Wind on a $1.2 billion construction financing of the first wind farm financing to be structured as a leveraged lease. The financing combined a Rule 144A bond issuance, a US Treasury cash grant, credit facilities from commercial banks and a forward commitment from tax-motivated equity to purchase and lease back to Terra-Gen each phase of the project. The project, which cost $1.95 billion in total, represented the first time that a US Greenfield project bond has been given investment-grade public ratings.

Other work of note includes advising a group of lenders on the $1.5 billion senior secured construction financing for the Ruby Pipeline Project, a natural gas pipeline which runs from Wyoming to Oregon's border with California. The $3 billion project was the largest commercial bank project financing to close in North America in 2010.

Shearman & Sterling has made international headlines this year with some of the largest and most complex project finance deals around the world. Clients appreciate the firm's "international scope" and "flexible and reasonable" fee structure. Peers note that the firm is particularly strong in the natural resources and mining sectors. One competitor says, "They do the complicated cross-border deals."

The firm represents major players including GE Energy Financial Services, Carlyle, Citibank, Macquarie, Fortress Investment Group and the US Department of Energy. "They are extremely good at understanding your business sensitivities," says one client. "You feel like you can trust them. They will alert you on something they know you will care about."

Shearman & Sterling's partners have impressed both peers and clients. One customer who regularly deals with Alexandro Padrés and Gregory Tan describes them as a "class act", adding that they are "pro-active", with an "ability to lead". A rival who has worked across the table from Robert Freedman, co-head of the firm's sustainable development group, says, "He's particularly reasonable and he's smart." A client who worked with Cynthia Urda Kassis says, "It was a very challenging negotiation and she was just outstanding. Even at a good firm, she was a star." Another customer describes Barbara Edwards as having "a great demeanour, which we always appreciate in a tough spot."

In January 2011, the firm advised Essar Global as sponsor, and its subsidiary Essar Steel Minnesota as project company, on the financing of a $1.1 billion mining project in Northern Minnesota. The scheme, known as the Integrated Iron Ore Pellet Plant Project, will be the first facility in North America which handles all aspects of the iron ore mining to steel-making process on-site.

The firm is currently representing Banco Nacional de Desenvolvimento Econômico e Social as the primary financier in a proposed $19 billion high-speed rail project connecting the Brazilian cities of São Paulo and Rio de Janeiro. The venture is set to be the largest infrastructure project to date in Latin America and will have far-reaching social and economic consequences.

With expertise in closing difficult transactions around the world and some of the most experienced lawyers in the industry, Skadden Arps Slate Meagher & Flom has a project finance practice which has stood the test of time. "There isn't any style of project or location that Skadden isn't familiar with, and their deep knowledge of all the key aspects of project finance are critical in solving the various problems that come up when doing any project finance deal," says one client.

The firm is particularly active in the power sector. It handles many of the largest and most complex projects involving loans from the Department of Energy and is currently working on over $10 billion of solar projects in the US. One competitor notes, "Skadden's project practice really grows out of their power industry practice."

The firm saw the retirement of several key practitioners in 2010. Partners Leslie Goldman and Jeffrey Christie retired in May and June respectively, followed in December by DC legend Erica Ward, who one rival describes as "the top project finance lawyer in Washington". However, the firm's legacy continues through partners such as Harold Moore, who was singled out for praise by several competitors. One peer identifies him as "one of the deans of the practice", adding, "He's been around forever and he's very well-respected." A client also identifies Moore, and colleague Tatiana Monastrskaya, as being amongst the best project finance lawyers in the country. "Their knowledge, attention to detail and expert advice are critical to me in all my deals," he says. "They are my number one choice across the street."

In an ongoing deal, the firm is representing NV Energy in the first transmission project to receive a loan guarantee from the Department of Energy. The $343 million loan will fund a project known as ON Line, which will connect power grids throughout Nevada.

The firm is also currently advising First Solar in obtaining a $967 million loan guarantee from the US Department of Energy for the 290 MW Agua Caliente solar project in Arizona. The deal is expected to be the largest operational photovoltaic site in the world.

What Sullivan & Cromwell's project finance group lacks in size, it makes up for in quality. "They have a very high-end group but a small group," says one competitor, while a client identifies them as "a leader in project finance". Peers note the firm's strength in mining and natural resources, and clients praise its partners' expertise in emerging markets. Sullivan & Cromwell advises industry giants including Exxon Mobil, RBS, RBS Securities and N M Rothschild & Sons.

The firm's stars include Fred Rich, who heads its global project development and finance group. One client says, "Fred is extremely good at being able to come up with practical solutions to complicated issues and being able to explain those solutions to a wide array of audiences and not come across as a typical Wall Street lawyer. He's very thoughtful about the implications of a given structure."

The firm has played a key role in advising on the PNG (Papua New Guinea) LNG (liquified natural gas) project, the largest-ever project financing, which involves an $18 billion natural gas scheme in Papua New Guinea. It is expected to provide customers in Asia with 6.6 million tons of liquefied natural gas per year, which have been sold under 20-year agreements to buyers in China, Japan and Taiwan. Sullivan & Cromwell was counsel to the project and its sponsors on the transaction, which closed in March 2010.

Since May 2001, the firm has been the sole international finance counsel in an ongoing $3.9 billion pipeline development designed to transport up to one million barrels of oil per day from Baku in Azerbaijan to the port of Ceyhan in Turkey. The scheme, known as The Baku-Tbilisi-Ceyhan Pipeline, involves many leading international oil companies and multiple lenders from around the world.

The project finance department of Mayer Brown is flourishing under the leadership of Barry Machlin. Peers characterise Machlin as a "solid lawyer", with one rival noting that he "has certainly been around long enough". Another competitor remarks, "I think they are doing more interesting and complex deals. I think they are on the cutting edge."

The firm recently represented lenders Banco Santander and Banco Nacional de Obras y Servicios Públicos in financing a $700 million Nuevo Pemex energy cogeneration facility in Tabasco, Mexico being developed by Abengoa in partnership with GE. The deal closed in June 2010.

Other recent highlights include acting as counsel to the financing parties in the first rail transit project to use private activity bonds. The $1.6 billion scheme is known as the FasTracks Eagle PPP commuter rail expansion project and is based in Denver, Colorado. The deal closed in August 2010.

Orrick Herrington & Sutcliffe counsels clients in a wide range of project finance matters and has particular strength in energy project development and finance, governmental energy funding and public-private partnerships. In March 2011, partner Sean Maloney joined the firm from Kirkland & Ellis. The same month, partner Stuart McAlphine left to go to Mayer Brown.

The firm receives praise from both clients and competitors. "They have a good group," says one rival. A client of the firm says, "Their experience and knowledge, particularly in the products I manage, is probably the best in the industry, and I think the prices are fair."

The firm recently represented BrightSource Energy in developing a $2.2 billion solar power scheme in the California desert, known as the Ivanpah project. Orrick advised BrightSource on issues including raising $580 million for the project and debt financing efforts. The transaction, which closed in April 2011, is the largest financing of a solar project to date, using the largest DOE loan guarantee yet issued.

Other notable work includes advising clients Fluor and Macquarie Capital on a public-private partnership (PPP) concession for the construction, financing and operation of a commuter rail network for the Denver metropolitan area. The scheme, known as Project Eagle, is part of a 12-year, multibillion dollar transit program for the area and is the first US rail project to utilise a public-private partnership structure. It closed in August 2010 and was named 2010 Americas Transport Deal of the Year by Euromoney's Project Finance magazine.

Described by one peer as a "classic project finance shop", Allen & Overy has produced on campaigns to influence governments and inform clients. These include a 332-page Global Guide to public-private partnership (PPP), published in March 2010, and a 10-page study called Rescue Investing Through Infrastructure PPPs. In addition, the firm has been active in transactional work. "We see Allen & Overy in a lot of deals," remarks another competitor.

The firm recently counselled Baja Mining and Minera y Metalurgica del Boleo on a $858 million greenfield project in Baja, Mexico, known as the Boleo mining project.

In another project, the firm is currently advising the Virginia Department of Transportation in its procurement of a long-term concession to design, build, finance and operate the US Route 460 Corridor, a 55-mile toll road in central Virginia. The scheme is expected to cost $2 billion.

Cleary Gottlieb Steen & Hamilton has a well-regarded project finance practice, with particular expertise in cross-border deals with Latin America. "They have a very strong LatAm practice," says one competitor. "They represent a lot of sovereigns and sub-sovereigns and they do everything for them."

In a deal which closed in April 2010, the firm represented Google in its investment in two wind farms in North Dakota developed by NextEra Energy Resources. The transaction represented Google's first direct investment in a utility-scale renewable energy project.

The firm also advised Deutsche Bank as the lender of a term loan to Angélica Agroenergia, a Brazilian sugar and ethanol producer controlled by Adecoagro, which invests in agriculture and renewable energy in South America. The term loan was secured by a mortgage on some Brazilian real estate owned by Angélica and a cash collateral account maintained in New York, and was also guaranteed by Adecoagro. The deal closed in July 2010.

The project finance group of Debevoise & Plimpton is known for developing innovative structures and techniques for large and complex transactions. The team is led by co-chairs of the project finance group, Ivan Mattei and Robert Gibbons, who peers describe as "really fine lawyers". One competitor says, "I have had the pleasure of working with both of them and they are both terrific to work with."

Debevoise & Plimpton recently advised on a $1 billion expansion of the existing $1.5 billion primary international terminal at JFK International Airport, and the negotiation of a related anchor tenant agreement with Delta Air Lines. JFK Terminal 4 is the largest airport facility in the US financed under a public-private partnership (PPP) arrangement. The firm acted as counsel for project company JFK International Air Terminal in the transaction, which closed in December 2010.

In an ongoing transaction which is expected to be worth more than $500 million, the firm advised on the Carlsbad reverse osmosis desalination plant in Southern California. The plant will be built at the site of the existing Encino power plant, which utilises sea water for cooling purposes. Some of the water discharge will be diverted to the new plant, which will convert it into 100 million gallons of drinking water per day.

The increasing presence of Clifford Chance in US project finance transactions has propelled the firm into this year's rankings. "There's a firm that got active recently," says one rival. "They are definitely a player."

In a deal which was signed in March 2010, the firm advised AEI as sponsor of a 300 MW coal-fired development in Guatemala and the corresponding $350 million financing provided by Central American Bank for Economic Integration, Bancolombia and several other Latin American banks. Complications included the lack of liquidity in the Latin American market at the time, and the high degree of political instability. The deal was the largest-ever foreign investment in Guatemala and the first major non-recourse project in Central America to be almost exclusively financed by Latin American banks.

The firm also recently represented IDB and the Japan Bank for International Cooperation as senior lenders for a $1.4 billion upgrade to the São Paulo ring road. Financing for the scheme, known as the Rodoanel Mario Covas Trecho Oeste Upgrade project, was closed in December 2009. Once completed, the project will increase network capacity, reducing travel time and carbon emissions. The firm's clients, along with three commercial banks, provided $940 million in loans to finance the concession and public works of Rodoanel Oeste.

Davis Polk & Wardwell is known for its small but potent project finance group. "They are highly responsive, very smart people who know what they are doing," says one client.

The firm recently counselled Odebrecht on its $1.5 billion Rule 144A/Reg S offering of 6.35% senior secured notes, which will raise capital for the construction of two deep sea drill ships. The ships will be able to drill up to 12,000 meters below the seabed off the coast of Brazil. The bonds represented the largest debt offering in Brazil in 2010.

The firm is also advising Credit Suisse in a $975 million bank and bond financing of a casino and racetrack development at two sites in Ohio. The project, which is sponsored by Rock Gaming and Caesars Entertainment, is ongoing.

Fulbright & Jaworski lost partner Brian Bradshaw to Morgan Lewis & Bockius in January 2011. However, the firm worked on several notable transactions in recent years. In an ongoing deal worth $387 million, its lawyers advised a multilateral lender in connection with the expansion of the São Paulo, Brazil subway system. The public-private partnership (PPP) gives the public sector responsibility for the construction of the civil infrastructure works, while the supply of rolling stock and systems and the operation and maintenance will be handled by ViaQuatro under a concession agreement with the State of São Paulo.

The firm also represented Anadarko Petroleum Corporation in a $15 billion deal which closed in August 2009. The transaction related to a deepwater oil & gas development in Ghana. The Jubilee Field, estimated to hold as much as 1.8 billion barrels, is the largest oil and gas discovery in West Africa in 15 years.

With an enviable global practice, Morrison & Foerster serves clients including the US Department of Energy, Toshiba, Tokyo Gas, Sovereign Risk Insurance, CH Energy Corporation and Mitsui & Co.

The firm recently represented the Department of Energy in providing over $1.4 billion in loan guarantees to subsidiaries of BrightSource Energy. The loans funded three projects in a solar thermal power complex in the Mojave Desert in California. The scheme, known as Ivanpah, is currently under construction and will be the world's largest solar power complex. It will almost double the amount of commercial solar thermal electricity produced in the US.

In another notable transaction, the firm advised Acciona Energia on the $375 million financing for a wind farm in the State of Oaxaca, Mexico, which is the largest wind farm in Latin America. The debt financing is provided by a syndicate led by IFC and IDB. Most of the energy produced is contracted out to Cemex. The deal closed in June 2010.