Investment and Loan Insurance for Natural Resources and Energy
This insurance covers risks linked to overseas resources development projects. NEXI further strengthens support for Japanese companies’ activities from a perspective of securing a stable natural resource supply. Reflecting the project's risk profile, the insurance features lower premium rates and a wide range of risk coverage compared with the existing services. The insurance provides cover for senior loans, subordinated loans and investments.
Cover for senior loans
This insurance covers losses suffered by a Japanese company or bank that provides a foreign government or a company with long-term business funds (untied to exports from Japan) to be used for projects related to resource development. Losses may be incurred when the Japanese company or bank is unable to redeem the principal and interest due to war, revolution, prohibition of foreign currency exchange, suspension of remittance, force majeure, or bankruptcy and default of a borrower.
- A senior loan should be made by a Japanese company for stake or right acquisition or off-take in projects of energy and resources.
- Generally, the establishment of an escrow account at a first-class bank in a developed country is required.
- Lower premium rates and higher percentage of cover are applied compared with the Overseas Untied Loan Insurance.
Cover for investment and subordinated loans
This insurance covers losses suffered by a Japanese company which has established a subsidiary or a joint venture in another country. The losses covered are incurred when the relevant subsidiary or the joint venture is forced to discontinue its business due to war, expropriation, terrorism or force majeure, such as a natural disaster.
- An investment or a subordinated loan should be made by a Japanese company for stake or right acquisition or off-take in energy or natural resource projects.
- Lower premium rates and higher percentage of cover are applied to a subordinated loan for resource and energy projects compared with the Overseas Untied Loan Insurance. A higher percentage of cover is applied to an investment in a resource and energy project compared with the Overseas Investment Insurance.