Bracewell partners Alistair Calvert and Adam Waszkiewicz explained to Energy Voice that decommissioning considerations are complex, but financing for deals in the space still exist.
Calvert said there are “significant risks involving complex practical and regulatory issues and bespoke and potentially unforeseen issues on each site. Layered over these risks and the scope for dispute within the project itself, is the question of liability for the costs of decommissioning.”
Waszkiewicz added that there is still financing for deals in the space. These could be either on a reserve-backed loan or pre-payment basis for “newer assets and for the right opportunities in later life assets. Such deals in the UK are likely to require a [decommissioning security agreement] and, increasingly, we see M&A deals structured such that the seller retains a certain portion of decommissioning liability in the asset.”
