Arrangers appointed for Zagros methanol finance

30 July 2004
Zagros Petrochemical Company (ZPC), an affiliate of National Petrochemical Company (NPC), has mandated HypoVereinsbank (HVB)and HSBCto arrange the financing for a new methanol unit in the Pars Special Economic & Energy Zone at Bandar Assaluyeh. The funds will consist of an export credit facility and a bridge loan.

HVB will take the lead in arranging the export credit facility, worth about Eur 140 million ($168 million), which will be covered by Germany's Hermes and will fund the main contract on the project, awarded to Germany's Lurgiin May. HVB and HSBC will each take 50 per cent of a bridging loan worth Eur 50 million ($60 million) for NPC, structured on a corporate basis. Facilities agreements are due to be signed by the end of August. 'The client really wants this to be a fast-track project so everything is moving at an accelerated pace,' says a source close to the transaction.

Lurgi's contract, to be carried out with local partner Energy Industries Engineering & Design, is worth an estimated $194 million and calls for construction of a 5,000-tonne-a-day methanol unit. The project is one of several methanol schemes under way in the country (MEED 2:7:04; 25:6:04).

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