Norton Rose Fulbright advises syndicate of international lenders and institutional investors on US$465 million financing for FSO Chalchi

Global law firm Norton Rose Fulbright has advised a syndicate of international lenders and institutional investors on the US$465 million project financing of the floating storage and offloading unit FSO Chalchi.

The financing, which is supported in part by export credit agency cover from China Export & Credit Insurance Corporation, will be drawn throughout the construction phase and is expected to convert to a non-recourse structure once FSO Chalchi reaches operations, with a tenor of approximately 14 years following completion. The transaction marks SBM Offshore's first transaction which combines commercial banks, institutional investors, and an export credit agency.

FSO Chalchi is currently being built and will operate under a long-term lease and operating agreement with Woodside Energy, through its Mexican affiliate, Woodside Petróleo Operaciones de México, S. de R.L. de C.V. The agreement has a duration of 20 years.

The vessel, based on a Suezmax hull design, will incorporate a disconnectable turret mooring system developed by SBM Offshore. It is intended for deployment in deepwater conditions of around 2,500 metres and will have storage capacity of approximately 950,000 barrels of crude oil.

Once completed, the unit will be installed at the Trion field, located offshore Mexico, approximately 180 kilometres from the coastline and near the maritime boundary with the United States.

The cross-border Norton Rose Fulbright team advising on the transaction was led by London-based partners Giles Brand and Andrew Williams, and included senior associate Jenny Carr and associate Rebecca Martindale. Tax advice was provided by partner Matthew Hodkin, counsel Will Scott and associate Amiya Doabia. Hedging advice was provided by partner Nigel Dickinson, counsel Sean Bruns and associate Sibel Kaan. Mexican law advice was provided by a team led by Mexico City-based partner Cesar Fernandez Gomez and including counsel Itzell Mendez Ramos and associate Felipe Creus. US regulatory advice was provided by a team led by Houston-based partner Utsav Mathur.