Infrastructure Debt, a division of Old Mutual Alternative Investments (“OMAI”), is proud to announce that it has partnered with Rand Merchant Bank (RMB), a division of FirstRand Bank Limited, and the ACED-AIIM-Reatile Consortium to reach financial close and commence construction on Castle Wind Farm (“Castle” or “Project”), the largest commercial and industrial wind farm in South Africa.

Castle has entered into a Power Purchase Agreement (PPA) with Sibanye-Stillwater, a multinational mining and metals processing group for the supply of renewable energy to the company’s South African mining operations via an Eskom wheeling agreement. This results in energy cost savings, increased energy security as well as decarbonisation benefits for Sibanye-Stillwater, with the addition of increased power generation capacity to the national grid contributing to offsetting the power deficit currently being experienced in the country. The Project represents a major step in Sibanye-Stillwater’s ambitions to deliver 580MW of its renewable project portfolio and is a significant milestone in its journey to carbon neutrality by 2040.

Castle represents a consortium of African Infrastructure Investment Managers (“AIIM”), through its renewable energy project development and delivery platform African Clean Energy Developments (“ACED”), and Reatile Renewables (Pty) Ltd (“Reatile”). RMB partnered with the consortium as the sole Mandated Lead Arranger for the Project. In collaboration with RMB, Infrastructure Debt acted in its capacity as a lender in the transaction and will co-fund the Senior Facility provided to Castle, which will be used to construct the wind farm.

Castle has a contracted capacity of 89MW (installed capacity of 96MW) and is located near the town of De Aar in the Northern Cape. Castle is only the second utility-scale private wind farm in South Africa, with its power wheeled across the national electricity grid. Castle follows Msenge Emoyeni, which was also sponsored by the ACED-AIIM-Reatile Consortium, which reached a financial close in March 2023.

Rolf Canto, the Head of Infrastructure Debt, says “We are encouraged by how South African companies such as Sibanye-Stillwater are coming to the party and committing to large-scale projects like Castle. Old Mutual Alternative Investments is a keen supporter of South Africa’s energy transition and we have entered the commercial and industrial power sector at an early stage, enabling us to deploy significant long-term capital into much-needed new power generation projects.”

Devan Naidoo, Infrastructure Debt’s lead transactor on Castle, added: “Infrastructure Debt was perfectly positioned with its deep-rooted market expertise and agility to execute the Castle transaction on time, which was critical given the pressure on the Project due to the macroeconomic volatility experienced around financial close. The Project will not only bring additional renewable energy capacity to the grid, helping to alleviate the national energy crisis but also assist Sibanye-Stillwater with its own green energy transition.”

OMAI Infrastructure Debt is an established South African institutional investor. Over the years, it has participated in several complex project finance debt transactions, including providing long-dated funding into power, renewable energy, public-private partnerships, and water infrastructure transactions. Its portfolio consists of investments in thirty-two infrastructure projects at various stages of construction and operations, with a highly specialised team exhibiting a significant track record of coordinating and structuring various infrastructure transactions. Infrastructure Debt remains committed to partnering with companies, commercial banks, and development finance institutions to drive a sustainable energy transition in South Africa.