KfW & FMO backed 50.4 MW Wind Project in Argentina Achieves Financial Closing

The USD138 million project is being financed by KfW IPEX-Bank and the Dutch development bank (FMO).

Total Eren, a leading renewable energy Independent Power Producer (“IPP”) based in Paris, has announced the successful closing of the financing of its 50.4 MW “Malaspina” wind project in southern Argentina.

The USD138 million project is being financed by KfW IPEX-Bank and the Dutch development bank (FMO).

The “Malaspina” wind farm is located in Chubut, one of the five Patagonian provinces which lies on the Atlantic coast and where average wind speeds can exceed 10 m/s (comparable with locations of offshore wind farms in the German part of the North Sea). The purchasing of electricity is secured via a USD-based 20-year Power Purchase Agreement (PPA) with CAMMESA, the partially state-owned operator on the Argentinian electricity market.

The 50.4 MW “Malaspina” wind farm, representing an investment cost of around USD 138 million, is co-financed by KfW IPEX-Bank and FMO. While KfW IPEX-Bank is contributing a tranche of around USD 64 million, 95% of which is covered by Euler Hermes, FMO provides USD 40 million.

Markus Scheer, member of the Management Board of KfW IPEX-Bank in charge for Power, Renewables and Water, said, “We are pleased about the successful financial closing of the Malaspina wind project for several reasons: The collaboration with Total Eren and FMO was both constructive and expedient. At the same time, the wind farm underscores our commitment to environmental and climate protection as well as KfW IPEX-Bank’s role as a supporter of European exports. In the past 12 months, KfW IPEX-Bank has financed five wind farms in Argentina with a total capacity of around 400 MW. This clearly shows our focus on the Latin American market and its relevance for the German and European export industry.”

The financing provided by KfW IPEX-Bank will be dedicated to the import of technology and equipment, which will be used for the construction of the project. The wind farm will be equipped with 14 type 3.6M114 wind turbines from the German company Senvion.

The latter will also take over the maintenance and servicing of the wind farm for the duration of the loan term, which corresponds to 15 years upon commissioning. The construction of the farm is scheduled for completion during the third quarter of 2019.

The financial closing of the “Malaspina” wind farm follows the successful financing of Total Eren’s “Vientos Los Hercules” wind farm (97.2 MW, currently under construction), which was completed in December 2017.

Fabienne Demol, Executive Vice President and Global Head of Business Development of Total Eren, said, “We are thrilled to reach the financial closing of the Malaspina wind project, which is an important milestone for us: Malaspina represents our second wind project in Argentina and reinforces our commitment to this market. I want to thank our experienced team for their excellent work to identify and deliver a successful financing structure for this project. I am excited to see the launch of the Malaspina wind farm and I am looking forward to developing further renewable energy projects both in Argentina and the Latin American region.”