“Building in-house capacity can help energy companies in Africa lower transaction costs arising from legal fees”, Tolulope Fadipe, Assistant General Manager, Legal, Sahara Group has said.
Fadipe who spoke at the Afreximbank Trade Finance Seminar (ATFS2023) in Lagos last week, said bespoke training and stretch programs with reputable law firms can facilitate knowledge acquisition and enhance technical abilities required for complex transactions in the continent and beyond.
He noted that having in-house lawyers and personnel with a full grasp of the legal dimensions of transaction complexities remained the “best shot” for helping companies reduce legal costs.
“Full participation of company lawyers in strategy development and execution of transactions has to be the way forward when you are looking to reduce legal costs. Energy firms and companies need to be intentional about growing wide and varied, across-the-board capacity for various energy projects and transactions,” he said.
According to him, in-house transaction strategy review and negotiations, leveraging technology and deploying virtual transaction processes can also help reduce legal costs incurred by organizations in executing projects.
“At Sahara Group, we continue to give our people platforms to grow capacity to support our upstream, midstream, downstream, power, and technology business operations across Africa, Asia, Europe and the Middle East. This has resulted in significant cost savings and overall value addition to our operations,” he said.
Fadipe said some of the major drivers of legal costs in finance transactions in international jurisdictions include regulated solicitors’ charges in the jurisdiction of the transaction, travel costs incurred by external counsel in carrying out Due Diligence and other aspects of the transaction, complexity/value of the transaction, availability of competent legal counsel in the jurisdiction of the transaction, and bilingual services, among others.
“Right from the point of hiring, it is essential for energy firms to be intentional about talent acquisition into the in-house legal team and also adopt a robust capacity building strategy to support regional and international transactions,” he added.