Aluminium Bahrain (Alba) has closed a syndicated $1.5bn loan for its $3bn sixth potline smelter expansion.

Twenty-two local, regional and international banks participated.

The mandated lead arrangers and bookrunners are the UK’s Standard Chartered, local Arab Banking Corporation (ABC) and ABC Islamic Bank, Gulf International Bank (GIB), the local Ahli United Bank, National Bank of Bahrain (NBB), Bank of Bahrain & Kuwait, and France’s Credit Agricole.

The lead arrangers are Saudi Arabia’s National Commercial Bank, Riyad Bank, National Bank of Kuwait, Saudi-based Arab Petroleum Investments Corporation, Kuwait Finance House and National Bank of Abu Dhabi (NBAD).

The arrangers are Kuwait’s Burgan Bank, Dubai’s Noor Bank, Mashreqbank, Bahrain Islamic Bank, Jordan-based Arab Bank, local Al Baraka Islamic Bank, India’s Bank of Baroda and Al-Ahli Bank of Kuwait.

NBAD was the global and conventional agent and Riyad Bank was the Islamic agent.

MEED reported in September that Alba had upsized the commercial loan from $750m to $1.5bn.

The $2bn financing package was originally planned to include roughly equal commercial bank, bond and sukuk, and export credit agency (ECA) tranches. Alba may choose to drop the bond and sukuk issuance thanks to the high levels of subscriptions for the commercial tranche.

The $1.5bn loan priced at 325 basis points over the London interbank offered rate (Libor). It has a seven-year tenor including three years’ grace. The principle will be repaid in eight semi-annual instalments.

The US-dollar financing comprises an $882m senior unsecured conventional term-loan facility and a $618m senior Shari’ah-compliant facility.

Local GIB, the US’ JP Morgan, and NBB were the global coordinators.

The aluminium company awarded the main engineering, procurement and construction management (EPCM) contract for the potline smelter to the US’ Bechtel.

The contract for the 1,792MW fifth captive power plant was awarded to a consortium of the US’ GE and Turkey’s Gama Power Systems.

The project will make Alba the world’s largest single-site aluminium smelter, boosting the site’s production capacity by 540,000 tonnes a year (t/y) to 1.5 million t/y.

It is due to be completed in 2019.