Oil trader Trafigura to invest in 2GW of renewables

Oil, metals and minerals trading firm Trafigura and fund manager IFM Investors have formed a new 50:50 joint venture (JV) Nala Renewables, through which they aim to have 2GW of wind, solar and storage projects to be operating, in late-stage development or construction by 2025.

The two currently have no investments in wind, according to Windpower Intelligence, the research and data division of Windpower Monthly.

Nala Renewables will identify, build and operate projects to generate energy primarily in Europe and Asia, where Trafigura is already operating, along with a handful of emerging markets. 

It will develop greenfield projects, but will also look to acquire companies or assets that fit its emerging portfolio of investments.

Projects will also operate next to the Trafigura Group’s mining, port and smelting infrastructure, with some of renewable energy used to power these sites.

It is anticipated that Trafigura will bring around 250MW to the venture in early-stage development projects.

The firm has also backed a long-term offtake agreement to some renewable assets on market terms, it said.

Jeremy Weir, executive chairman and CEO of Trafigura said: “The energy transition is driving the need, but also provides the opportunity to make strategic, long-term investments in renewable energy. 

“The investments will provide synergies for our new power and renewables trading division which is going to become a significant pillar of our trading activity over the next few years and beyond and builds on our capabilities and understanding of other energy markets.”

Fifteen professionals are being recruited to kick off the venture, with support from renewables experts at IFM Investors and Trafigura.

Trafigura and IFM had previously formed a separate JV in 2018, Impala Terminals, through which they own and operate a logistics network for oil, metals and minerals.

Trifigura is based in Geneva and is one of the biggest independent oil traders in the world, while IFM Investors has about €44 billion invested in infrastructure, according to the Financial Times.

The joint venture is worth about £2bn (€2.2bn), after Trafigura launched its power and renewables division last year.

The firm also has an equity stake in green-hydrogen production firm Hy2gen AG and has a venture capital wing that is investing in new fuels and energy storage.