Morais Leitão and JLA Advogados e Consultores advise EDF and ITOCHU consortium on closing of Timor-Leste's largest solar project and BESS

Morais Leitão and its exclusive Timor-Leste member, JLA Advogados e Consultores, advised the consortium formed by EDF Power Solutions and ITOCHU Corporation on the closing of the Manatuto solar power plant project, the largest solar project in Timor-Leste and one of the most significant investments in energy infrastructure undertaken in the country. The landmark investment, which is also Timor-Leste's first independent power producer project, will be operated by Manatuto Renewables Power and is set to reduce the country's reliance on imported diesel and transform the energy landscape.

The project, which represents Timor-Leste's first major independent power producer (IPP) project for renewable energy, involves the construction of a 72 MW solar photovoltaic power plant, complemented by a 36 MW/36 MWh battery energy storage system. Under a power purchase agreement (PPA) with Electricidade de Timor-Leste (EDTL), the infrastructure will be developed and operated by the EDF and ITOCHU consortium over a period of 25 years. The project also benefited from the support of a coalition of international development partners, in a financing package totalling USD 85.7 million, which included the International Finance Corporation (IFC), part of the World Bank Group, the Asian Development Bank (ADB), the Japan International Cooperation Agency (JICA), and the Government of Canada, through the Canadian Climate and Nature Fund for the Private Sector in Asia (CANPA).

The financial close of the project was, in itself, a pioneering milestone for the Timorese legal system. The security structure designed to secure the financing involved solutions unprecedented in the country, with an application having been submitted for what will be the first mortgage deed ever registered in Timor-Leste. This outcome represents a significant contribution to the consolidation of financing mechanisms for large-scale projects in Timor-Leste, paving the way for future infrastructure financing transactions in the country.

The start of construction was marked by a ground-breaking ceremony presided over by the Prime Minister of Timor-Leste, Kay Rala Xanana Gusmão. Once operational in 2028, the plant is expected to meet around 30 per cent of the country's electricity needs, helping to reduce dependence on imported fossil fuels and generating estimated annual savings of between 25 and 30 million dollars in fuel costs.

The Morais Leitão team was led by André de Sousa Vieira (Partner) and counted on the support of José Maria Falcão (Associate). On the JLA Advogados e Consultores side, the team comprised Soraia Marques (Partner), Lukeno Ribeiro Alkatiri (Partner), Andreia Morris Mendes (Associate) and Shelma Silveira (Consultant).