Aluminium Bahrain (Alba) could increase the size of its recently syndicated loan from $750m, its CEO Tim Murray told an earnings call.

Alba intends to finalise the loan in the third quarter, and award a contract for the captive power plant.

“We did go out to the market and we were targeting anywhere from $500m to $750m,” Murray was quoted by Reuters as saying. “We had very, very good demand, so we’re finalising the terms and the conditions but we expect this to be a bit more than the $750m.”

Alba requested submissions from local and international banks in June. The loan is expected to have a seven-year term and an amortising structure. It is in US dollars with Islamic and conventional tranches depending on offers from banks.

The financial advisers are the US’ JPMorgan and the local Gulf International Bank and National Bank of Bahrain.

The entire finance package for the $3bn project will be more than $2bn, with a debt to equity ratio of 70:30. Alba is planning an export credit agency (ECA) tranche and a bond or sukuk tranche, which will now be adjusted down.

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

MEED has reported that the shortlisted bidders for Alba’s 1,300MW fifth captive power plant are the US’ GE with Turkey’s Gama Power systems Engineering & Construction, and Germany’s Siemens.

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.

The budget was cut from $3.5bn to $3bn in response to lower commodity prices, Alba announced in May.

The company’s first half net income fell 69.4 per cent year on year, to BD20.5m ($55m), despite sales volume increasing 3.2 per cent. Sales by value were down 17 per cent to BD165.7m.