Emerging markets and renewables are the buzzwords for Baker & McKenzie’s energy practice, as the international firm extends its reach beyond its long-established staples in oil, gas and power.
The Chicago-headquartered firm has assembled a veritable army of more than 320 lawyers in its core energy group. It is also bulking up its team in an effort to clinch the high-level deals pouring out of Asia-Pacific, Europe, the Middle East, Africa and the Americas.
Global energy practice group chairman Jim O’Brien says: “Our energy practice is and in terms of [firmwide] revenue, about 25 per cent is derived from clients in the energy business.”
Top of Bakers’ list is Africa, where the firm recently rolled out a global emerging markets initiative. Although it is yet to open an office in sub-Saharan Africa it is already doing business in South Africa, Angola and Kenya through associations with local firms.
“The development of natural resources in emerging markets is a key initiative for our energy, mining and infrastructure group,” O’Brien says. “It’s broader than just energy and gas – it also includes mining and minerals. We underestimate our mining practice, although it’s very strong.”
The firm sees national oil companies as a rich vein of new work, addressing the needs of resource-rich countries seeking to develop industries around their natural resources and linking these up with nations seeking to secure and diversify their energy resources internationally.
Bakers is also ramping up its climate change, renewable energy and clean technology practices, tapping into regulatory work and advising on cross-border investments and creative financing across the US, Europe and Asia.
“Whether the world is going to develop carbon control is not the issue – the bigger issue is that people have recognised that carbon-neutral and reduction projects will over time become more important,” O’Brien says.
He pinpoints the US as a particular growth area for the renewables practice – Bakers recently advised Project Resources Corporation and Miracol Energy on the structuring and financing of a $59.5m wind energy project in Minnesota.
The firm has responded to the variety and volume of work being generated by the energy sector by bulking up its global team with a series of strategic hires.
These include partner Kamila Tarnacka in Warsaw, who joined in March from CMS Cameron McKenna, Henry Cort who joined from Trowers & Hamlins in Singapore, and Calvin Walker, who joined from Allen & Overy in London.
As an energy and project finance partner, London-based Walker is collaborating with partner Neil Donoghue to act for Korea Electric Power Corporation (Kepco) on the development and financing of a $30bn nuclear power plant in the United Arab Emirates.
“The Middle East, notwithstanding the current political unrest, goes hand in hand with the growth of the nuclear market,” Walker says. “With oil prices so high it does not pay for these countries to burn it off, so they’re monetising it by exporting it, and then turning to nuclear as a clean way to make their own power.”
Walker also identifies China as a major focus for the firm’s energy practice. One of the firm’s top energy deals involved advising China’s state-owned oil company CNOOC on its joint venture with Bridas Energy Holdings for a cash consideration of $3.1bn in March 2010.
“There’s a lot of opportunity on the M&A side, with China gaining assets through corporate and asset acquisition, and also on the financing side,” Walker says. “They also export their technology to the Middle East.”
O’Brien says it is his lawyers’ ability understand and adapt to the commercial energy market that differentiates Bakers.
“Lawyers have to understand the business and context, and give legal advice against the backdrop of commerce and industry,” he says.
Calvin Walker, Henry Cort, Kamila Tarnacka
Top three sectors
Oil and gas
Top three geographical regions
Ensco’s $7.3bn cash and stock acquisition of Pride International
Lead partners: Alan Harvey, Helen Bradley
Ma’aden’s $10.8bn Saudi Arabian joint venture with Alcoa
Lead partner: Mike Webster
Korea Electric Power Corporation’s $30bn UAE nuclear power plant
Lead partner: Neil Donoghue