The US shale gale has rejuvenated Akin Gump Strauss Hauer & Feld’s traditional oil and gas practice, much in the way a merger with Orrick Herrington & Sutcliffe might have rejuvenated the entire firm.
The aborted deal – talks started and ended in October 2010 – had, on paper at least, the potential to catapult Akin to another level in terms of its financing strength. The boom in shale-related activity has performed a similar role for Akin’s energy and global transactions practice, led by Jim Rice.
The firm’s relationship with Anadarko Petroleum Corporation stretches back many years, and the company’s general counsel, Houston-based Bobby Reeves, was happy to return to Akin when Anadarko sold an interest in its Eagle Ford shale assets to a subsidiary of Korea National Oil Corporation (KNOC) for $1.55bn.
Rice led his firm’s team on the deal, at the time the second-largest purchase of US oil and natural gas fields in 2011.
“Andarko only done two large deals in this space and we handled both,” says Rice. “The first was in 2010, the Mitsui deal in the Marcellus shale. Anadarko came back to us for this year’s deal.”
Over the past year Akin’s lengthy record in the oil and gas sector also positioned it well to capitalise on BP’s woes following the oil spill in the Gulf of Mexico. A team led by London-based partner Steve Blakely advised on a brace of deals for Bridas Energy triggered by BP’s asset sales – a $7.1bn joint venture with China’s CNOOC to acquire 60 per cent of Pan American Energy (the US’s second-largest oil producer) and a joint venture, again with CNOOC, that resulted from the Chinese company’s acquisition of 50 per cent of Bridas Corporation.
Further afield, another London-based partner – former White & Case partner Greg Hammond – teamed up with partner Doug Glass to advise Russian giant Lukoil on its interests in the West Qurna 2 field in Iraq. Akin has been Lukoil’s principal outside counsel since it handled the company’s listing of global depositary receipts in London in the mid-1990s. This part of Iraq is thought to contain the world’s fourth-largest reserves, and investment in it is expected to exceed $30bn. Akin is involved in what is seen as a pioneering part of the post-war regime.
“There’s no doubt that this project, which involves removing random unexploded mines and munitions from certain areas, is challenging,” reports Hammond. “But
the potential rewards are astronomical.”
Although shale – the leading transaction driver in the US oil and gas sector – is Akin’s primary target market, at least in the short term, it is also focusing heavily on renewables in the longer term. The firm believes that other US states will ultimately follow California’s lead by issuing a date by which they need to be running on 33 per cent of renewable and sustainable energy sources – a trend that will see transactional activity in the sector pick up steam.
No surprise then that in 2010 Akin made a push to recruit some of the US’s leading renewables talent, bringing in Bob Nelson in San Francisco and Elliot Hinds and Dino Barajas in Los Angeles.
Barajas in particular has delivered. Late in 2010 he led a team representing Polaris Energy Nicaragua on the development and financing of the $160m San Jacinto project, the largest geothermal power plant in the country’s history. When the two phases are combined the project will be worth in the region of $250m.
“Barajas’s execution of his business plan has exceeded expectations,” admits Rice. “He’s a rising star in our energy practice.”
In May the firm hired Chadbourne & Parke partners Ed Zaelke and Adam Umanoff to further boost its renewables practice.
Akin’s international reach was increased in 2010 when it opened an office in Geneva, focused primarily on international arbitration, off the back of the fallout from the merger of Hogan & Hartson and Lovells.
Jim Rice, Greg Hammond, Dino Barajas, Doug Glass, Ed Zaelke
Top three sectors
Top three geographical regions
Russia and the CIS
Anadarko Petroleum’s Eagle Ford shale asset sales
Lead partner: Jim Rice
Bridas Energy’s $7.1bn joint venture with CNOOC
Client: Bridas Corporation
Lead partner: Steve Blakely
Lukoil’s development of the West Qurna 2 oil field in Iraq
Lead partners: Doug Glass, Greg Hammond