PowerChina International Ltd will arrange debt financing as EPC contractor on Costa Rica’s USD 1 bn MegaTerminal of the Atlantic, this news service understands.
The MegaTerminal of the Atlantic (MTA) project will carry a debt-to-equity ratio of about 80:20.
Amega, the sponsor of the project, is arranging the equity portion with advisor IBG Global. The equity portion of the project remains open, but sponsors expect to have it in place by May.
As the nominated EPC, PowerChina will provide debt through its banking network. Sources declined to provide additional details.
"The MTA Project will be a huge success because it proactively addresses the anticipated future transshipment shortfalls in the Caribbean," Aubrey de Young, CEO of project sponsor Amega Holdings, told InfraLatinAmerica. "We look forward to adding more partners to the team as the full project is completed."
The MTA will be built on the Caribbean coast, near the shipping and cruise port of Limon, with the capacity to accommodate the largest container ships currently in operation or on order. It will also handle ships too large to pass through the expanded Panama Canal.
The main sponsor of the project, Amega, is the Costa Rican operating company of Amega Holdings Inc. Amega is a special purpose vehicle (SPV) with partners from the UK, Canada, Costa Rica and the US.
IBG, a South Africa-based firm, is Amega's financial advisor and lead arranger for the project. Hazel Cordero, partner and director at IBG Global, works as its representative in Costa Rica. IBG is in the process of arranging equity for MTA on Amega’s behalf. Other equity providers may participate in the project.
IBG is also the commercial and legal adviser for Sinohydro, part of the group of companies that include PowerChina International.
PowerChina secured its role in the project on 27 March with signatures from Amega CEO de Young, IBG strategic advisor Karl Single and Hou Xiaotun, executive vice president of PowerChina (pictured at right).
The MegaTerminal of the Atlantic project (MTA) marks the first stage of Amega’s plan to develop a “dry canal” across Costa Rica, starting with the Atlantic Ocean terminal and linked by a railway to a second port on the Pacific coast.
The Costa Rican government on 3 February said Amega received a Notice to Proceed with the proposition phase of the project development. This includes the environmental impact studies (EIS), financial analysis, the front-end engineering design (FEED) and the engineering procurement construction contract (EPC) for the new transshipment terminal.
Under Costa Rica's private initiative process, projects comprise three stages: postulation, proposition and concession award.
US-based engineering and advisory company Moffatt & Nichol is also working on the project with Amega.
The MTA Project marks the first public works project in Costa Rica to be approved under the country's private initiative laws. Amega holds exclusive rights to lead the project through the proposition phase.
PowerChina has been involved in other projects and deals in Latin America over the past three years, according to InfraDeals. PowerChina won a USD 340m Cauchari wind farm project in Argentina in 2016. Sinohydro has also approached Colombia about taking over the Magdalena River navigability project in Colombia. It also bid on six road projects in Colombia between 2015 and 2016 but did not bid on any of them. The company successfully won and financed the USD 63.4m Agua Zarca hydroelectric project in Honduras.