LAWFUEL – News Release Service – Herbert Smith’s energy finance team has advised The Royal Bank of Scotland plc (RBS), as documentation bank and facility co-ordinator, and International Finance Corporation (IFC) on a syndicated hybrid revolving credit facility for Cairn Energy PLC, an independent FTSE 100 oil and gas exploration and production company based in Scotland and operating in South Asia.
RBS and IFC (the private sector arm of the World Bank Group), along with several other international banks, are providing Cairn Energy with a facility of up to $1 billion comprising a $850 million development tranche and a $150 million corporate tranche, the largest facility of this type to date in the UK market.
The funds will be primarily used to finance Cairn Energy’s operations in oil field development and production, particularly in the Rajasthan block in India which includes the Mangala Field, the largest oil discovery in India for 22 years. The funds will also be used to refinance existing debt.
The Herbert Smith team was led by partner Adrian Cheng and head of finance Jason Fox, assisted by associates Wanda Tomaszek and Thomas Bethel.
Adrian Cheng commented:
“We are delighted to have worked with RBS, IFC and Cairn on what is a benchmark deal for the upstream oil and gas market. This is the largest reserve-based lending for at least a decade and the fact that the facility is supported exclusively by a South Asian asset base makes it unique”.
Herbert Smith provided the lenders with English law advice, working with Alliance member Stibbe, which provided Dutch law advice, and local counsel Freehills (Australia), Maclay Murray & Spens (Scotland) and J Sagar Associates (India).
McGrigors advised Cairn Energy.