Clifford Chance advises on the refinancing of the Formosa 2 offshore wind project

Global law firm Clifford Chance has advised the Formosa 2 project company and its sponsors, Synera Renewable Energy and JERA Nex bp, on the refinancing of the Formosa 2 offshore wind (OSW) project in Taiwan. The transaction represents the first refinancing of an OSW project in Taiwan and the broader Asia Pacific region

The Formosa 2 project is a 47 turbine, 376MW offshore wind farm in Taiwan which achieved commercial operations in September 2023. Clifford Chance has advised the project and sponsors from the initial development phase to date.

The refinancing facilities are provided by 17 Taiwan lenders (including state-owned banks) and 10 international banks, backed by the continued support of the four original export credit agencies. Clifford Chance worked alongside the sole financial advisor, Sumitomo Mitsui Banking Corporation (SMBC), and the project and sponsor teams to structure this first-to-market transaction.

Matt Buchanan, Partner said, "We are thrilled to have supported the Formosa 2 project team on this outstanding achievement. Our journey with Formosa 2 began at the earliest stages of procurement and has spanned initial project financing, commercial operations and now the next phase through this refinancing. Despite recent sector challenges, the Formosa 2 team has shown there is strong ongoing opportunity for well‑managed and structured projects."

Tom Capel, Counsel said, "This is a landmark moment for the Formosa 2 project and the broader OSW market in Taiwan and the broader Asia Pacific region. This transaction marks a step-change in the maturity of the OSW sector in Taiwan and provides a model for other projects to recycle capital and enhance financing structures for stakeholders."

Chad Bochan, Partner added, "It is encouraging to see refinancing techniques successfully deployed in highly mature lending markets such as Australia now being applied in Taiwan. This demonstrates the rapid evolution of Taiwan's OSW market, with its first refinancing achieved less than a decade after we  documented of the region's earliest OSW project financings. Facilitating the recycling of capital and broadening the pool or participating financiers can only benefit the sector, reducing concentration limits and enabling lenders to reinvest in new opportunities."

Matt, Chad and Tom led the Clifford Chance team, with support from senior associate Thomas Hobbs-Martin, associate Siewy Yong and graduate lawyer Benjamin Batten. Senior associate James Thornton provided specialist project documents advice, while counsel Adam Wood led on hedging matters, supported by associate Alice Tsui and trainee solicitor Patrick Heung. Partner Hein Tonnaer, senior associate Martine Trip and trainee solicitor Derek Rademaker advised on matters of Dutch law.

This transaction builds on Clifford Chance's record in relation to first of a kind OSW projects in Taiwan, having recently advised the ECAs lenders on the financing of the Hai Long OSW project (the first corporate offtake-backed wind project in APAC), La Caisse on its landmark US$2.7 billion acquisition and financing of Greater Changhua 1, the US$2 billion financing of Formosa 2 and the US$627 million financing of Formosa 1 – Taiwan's first commercial scale and Asia Pacific's first project financed offshore wind farm.