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K&P Receives Certificate from Energy Charter Secretariat

On 14 October 2019, Khalifeh & Partners’ Khaldoun Nazer (Partner) received a Certificate of Appreciation from the Energy Charter Secretariat, recognizing the firm’s contribution to the 2019 Energy Investment Risk Assessment (EIRA). Notably, Khaldoun Nazer, Siwar Saket (Associate), and Dana Mubaidien (Associate) have been mentioned as individual contributors in Jordan. K&P was contacted by the Secretariat early last year to provide advice and information about the energy sector in Jordan for its flagship publication, EIRA, which would assess specific policy, regulatory, and legal risks in the energy sectors of various countries, including Jordan. EIRA 2019 was successfully completed and launched on 30 September 2019, after development under the Albanian Chairmanship of the Energy Charter Conference. The International Energy Charter has further launched a website to outline EIRA, offering up-to-date information on the regulatory frameworks of the participating countries, including Jordan.

Within the last year, The Hashemite Kingdom of Jordan has ratified and entered into force the Energy Charter Treaty (ECT).The Jordanian Parliament ratified the Treaty in April 2018, making the country the 51st Contracting Party of the ECT. Additionally, on 11 December 2018, Jordan joined the 1994 Protocol on Energy Efficiency and Related Environmental Aspects (PEEREA) which requires participating states to formulate clear policy aims for improving energy efficiency and reducing the energy cycle’s negative environmental impact.

The Secretariat believes that the ECT will enhance confidence in the investment climate in the energy sector in Jordan and attract foreign investments for infrastructure projects in this field, in addition to strengthening the Kingdom’s position as a transit country for energy projects, where transit across its borders is secure and stable and facilitating technical assistance, especially oil and gas pipelines and electricity interconnection projects.

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K&P Awarded “National Firm of the Year”

For the past several years, Khalifeh & Partners has been ranked ‘Tier 1’ by all major legal directories, including Chambers & Partners, IFLR 1000, and The Legal 500. Recently, Khalifeh & Partners achieved the ranking of National Law Firm of the year (Jordan) on October 17th during IFLR 1000’s 2018 Middle East Awards. The event took place at the Burj Al Arab in Dubai and celebrated the most innovative legal work over the past 12 months across six categories, as well as the  teams behind it.

 

K&P was recognized for the firm’s leading roles on numerous financing transactions, including a number of high-value projects such as the USD $1.4 billion Attarat Um Ghudran Oil Shale Fired Power Plant, in addition to several M&A transactions including Pepsico’s sale of 52% shares to CIB Investments SPC Limited, and ADP’s acquisition of shares in Airport International Group (AIG). The firm was also recognized for its pioneering work in other sectors, including Jordan’s sports and entertainment law through its submission of several successful appeals to the Asian Football Confederation (AFC) and the Federacion Internationale de Football Association (FIFA).  Finally, K&P also advised the Energy Charter Secretariat on the barriers and risks related to foreign investment in the energy sector in Jordan.  K&P’s role is anticipated to support Jordan as it moves to sign the Energy Charter Treaty, the only legally-binding international treaty that establishes a multilateral framework for cross-border cooperation in the energy industry.

 

“We are honored to be the recipient of such an award”, says Managing Partner Ala’ Khalifeh. “Khalifeh & Partners always strives to provide the most comprehensive and efficient advice to our clients, and our lawyers receive cross-sector training and experience so that they are able to think critically and innovatively about every transaction. This award speaks to the dedication and diligence of our team, and I couldn’t be more proud.” Gratitude to K&P’s clients was expressed by Khaldoun Nazer, who says “the trust of K&P’s longstanding clients has led us to the top of the legal market in Jordan. We will continue to provide our clients with the excellent services they deserve as we strive to understand their business needs and provide them with tailored legal advice.” Iyad Hamarneh, Partner and head of litigation at K&P offers further explanation and praise, saying “In every corporation, there are several factors that provide a foundation for success. We at Khalifeh & Partners are blessed and proud to have a dedicated and hardworking team who spare no effort and work closely together to establish and maintain the firm’s excellent reputation. Without this team, we could not have won this award.  For each one of you, thank you very much for this achievement. ”

 

K&P would like to thank its clients and partners both in Jordan and abroad for their cooperation and hard work during the past year, and would also like to congratulate all of the winners.

 

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K&P Hosts Working Group with Delegates from the Energy Charter Secretariat

On 21 June 2018, a team from Khalifeh & Partners including Ala’ Khalifeh (Partner), Khaldoun Nazer(Partner), and Siwar Saket (Associate) met with representatives from the Energy Charter Secretariat during the Secretariat’s working visit to Jordan to discuss barriers and risks to investment in the energy sector in Jordan. Earlier this year, K&P was contacted by the Secretariat to provide advice and information about the energy sector in Jordan for its flagship publication, the Energy Investment Risk Assessment (“EIRA”), which will assess specific policy, regulatory, and legal risks in the energy sectors of various countries, including Jordan.

Though Jordan has not yet signed the Energy Charter Treaty (”ECT”), it is an observer to the Energy Charter Conference, having signed the International Energy Charter political declaration at a ministerial level summit in The Hague, the Netherlands, in May 2015. It has also signed the European Energy Charter Declaration of 1991 and has completed the relevant technical procedures in order to accede to the ECT.

The Secretariat believes that the ECT will enhance confidence in the investment climate in the energy sector in Jordan and attract foreign investments for infrastructure projects in this field, in addition to strengthening the Kingdom’s position as a transit country for energy projects, where transit across its borders is secure and stable and facilitating technical assistance, especially oil and gas pipelines and electricity interconnection projects.

Currently, the ECT is being reviewed by the Jordanian Parliament. It is expected that the Kingdom will move to ratify the ECT in the near future.

The Future of Renewable Energy in the Middle East

With recent developments in energy law and a plethora of opportunities for international investment, Jordan has the potential to become a global leader in the field of renewable energy.

The EDAMA Association for Energy, Water and Environment, in partnership with the United States Agency for International Development (USAID), released the first-ever Jordan Clean Technology Sector Report in January 2017. The report finds renewable energy and energy efficiency to be the two clean technology sectors that have matured the most in Jordan, with hydropower and biogas showing potential for future development.

Overall, renewable energy projects are on the rise. Last month, his Majesty King Abdullah II oversaw the launch of 12 new photovoltaic power plants expected to generate 200 MW of electricity.

Furthermore, the Ministry of Energy and Mineral Resources (MEMR) is currently seeking expressions of interest for the construction of what is anticipated to be one of the largest utility-scale electrical storage projects in the Middle East. Located in the Ma’an governorate, “the storage facility will be primarily used for ramp-rate control of PV and wind power plants, as well as for energy shifts of otherwise curtailed renewable energy.” Phase 1 of the project is scheduled for completion by August 2019, while Phase 2 is expected to be completed by 2020.

Other more established projects are also beginning to see returns on their investment. Jordan’s first-ever wind farm project – located in Tafila – recently celebrated its first year of commercial operations.

“The wind farm project in Tafila has laid the foundation for the government to achieve its goal of diversifying energy sources. Since the launch of this project, we’ve advised numerous developers, lenders, and EPC contractors in connection with a number of solar and wind projects,” says Ala’ Khalifeh, Managing Partner at Khalifeh & Partners.

Such developments are evidenced by the launch of several solar and wind projects throughout the Kingdom in recent months, namely in Ma’an, Fujeij, El Quweira, Mafraq, and Aqaba.

 

Regulatory changes

Funding for current renewable energy projects in Jordan has come from both domestic and international investors, including the International Finance Corporation, ACWA Power, and the European Investment Bank. Recent regulatory changes are expected to encourage additional foreign investment and spur further growth in the Jordanian renewable energy sector.

The new laws, under the Regulation for Organizing Non-Jordanian Investments No. 77, loosen the requirements for foreign investors and are expected to have a positive impact on investment in the clean and alternative energy sectors.

Other government policies continue to encourage investment. Jordan has committed to allocating a share of 10 percent of its total energy mix to renewable energy by 2020. The government plans to accomplish this through long-term Power Purchase Agreements, tax and customs exemptions for renewable energy systems and equipment, and other incentives that promote clean energy projects outlined in the Renewable Energy and Efficiency Law (REEEL).

 

Impact on the private sector

According to EDAMA, 82 percent of surveyed companies are fully owned by Jordanians and they employ nearly 13,000 employees, 72 percent of whom are engineers or technicians.

The projects, many which are located outside of major cities, provide an opportunity to increase employment and raise living conditions in more rural areas of the country.

The uptick in renewable energy investments in Jordan has also inspired the expansion of university programs that train future employees in subjects critical to such fields, including energy and water engineering and environmental management.

 

Our take

Jordan’s solar and wind energy potential has the power to bring significant investments to the country, provide jobs across a variety of sectors to an expanding workforce, and demonstrate a model for other countries on the cusp of shifting toward a more sustainable future.

Mr. Khalifeh offered, “Jordan has been among the first in the [MENA] region to set the model for diversification and sustainability when it comes to energy sources, and the continued interest from many parties with regards to investment in these programs is evidence that this commitment is paying off.”

Khalifeh & Partners is renowned for its lawyers’ expertise on the renewable energy sector in the Middle East. Our firm has been at the forefront of legal developments in solar, wind, and conventional power in Jordan for more than a decade