Mayer Brown advises Clifford Capital and Pentagreen Capital on joint loan to finance bioenergy projects in Southeast Asia

Mayer Brown has advised Clifford Capital, an infrastructure financing platform, and Pentagreen Capital, the sustainable infrastructure debt financing platform established by HSBC and Temasek, on a US$30 million joint green loan to leading Singapore energy provider, BECIS Bioenergy Pte. Ltd. (BECIS). This collaboration is set to catalyze the construction of a portfolio of distributed sustainable bioenergy projects across Southeast Asia and India.

The loan will finance 14 individual bioenergy installations across Thailand, Philippines, Indonesia, Cambodia, and India, all of which are located at industrial and manufacturing sites operated by established local and multinational companies across various industries. The projects convert agricultural waste and other sustainably sourced feedstock into renewable steam, which is delivered to industrial customers under offtake agreements.

The loan provided by Clifford Capital, as the structuring arranger, together with Pentagreen Capital, as the green loan coordinator, was arranged in an innovative dual-tranche structure where Pentagreen’s tranche is subordinated to the commercial tranche provided by Clifford Capital and has a differentiated repayment profile. The combined solution unlocks the full required financing package for the borrower and will generate growth in energy efficiency and sustainability activities in the region.

The financing has been structured as a green loan under BECIS’ Green Loan Framework, which is aligned with the Green Loan Principles 2023, administered by the Asia Pacific Loan Market Association and Loan Syndications and Trading Association. A second party opinion has been issued by Sustainalytics.

Ben Thompson, head of Projects & Infrastructure (Asia), commented: "We are delighted to have advised on this innovative portfolio project financing in the energy transition space, which is becoming an increasingly common approach in the renewables sector, where individual projects can be modest in size. With projects and assets across multiple jurisdictions, the structuring and documentation process was a complex one, but it is a credit to all involved that a documentation package was agreed in a relatively short timeframe and is one which we expect to see rolled-out for future scaling opportunities. Congratulations again to the teams at BECIS, Clifford Capital and Pentagreen for a great team effort."

The Mayer Brown Singapore-based team was led by partner Ben Thompson and senior associate Tom Crane, with support from registered foreign consultant Matthew Chow, and associate Qin Koh.