850 MW gas-fired power project in Mexico reaches financial close

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EVM Tenedora, S.A.P.I. de C.V. and EFS Global Energy B.V., a subsidiary of GE, has secured US$740 million financing for the development of an 850 MW power plant in Axapusco, Mexico, located approximately 60km north-east of Mexico City.

More than a dozen institutional investors and a syndicate of commercial bank lenders, including Citi, BNP Paribas, Sumitomo Mitsui Banking Corporation and Banco Nacional de Comercio Exterior, S.N.C. (Bancomext), partipicated in the financing, which comprised a hybrid 4(a)(2) private placement, term loan and letter of credit facility.

Known as EVM II, the combined cycle natural gas-fired power plant is part of a broader modernization plan instituted by Comisión Federal de Electricidad, Mexico’s state utility, to meet the growing energy needs of the critical Mexico City and Guadalajara regions.

Milbank, Tweed, Hadley & McCloy LLP represented the lenders in the financing transaction.

EVM Tenedora is a subsidiary of EVM Energía. EVM II is the company's successor project to EVM I, a 94 MW gas-fired fired power plant also located in Axapusco. EVM began construction of the plant in 2013 and commenced operations in December 2016. GE provided the turbines.

Following this, the two companies signed a Memorandum of Understanding (MoU) to collaborate on future energy projects, both thermoelectric and renewable, in April 2017. Though, neither party formally announced the development of this project.

GE has been active elsewhere in Mexico. Recently, the company completed a gas turbine upgrade project at the 450 MW Fuerza y Energía de Tuxpan facility in Veracruz, which is owned by Naturgy.

Also, last year GE signed a supply agreement for a new combined-cycle gas-fired power plant in Guadalajara. Owned by Fisterra Energy, the 875 MW Tierra Mojada project will feature two GE 7HA.02 gas turbines, one steam turbine, three generators, two heat recovery steam generators (HRSG) and the latest plant control systems.