Bahrain LNG has closed $741m limited recourse financing for its liquefied natural gas (LNG) receiving and regasification terminal.

A syndicate of nine international and regional banks is participating in the 20-year loan for the first such project to be developed on a PPP basis in the Middle East.

Korea Trade Insurance Corporation (K-Sure) covered commercial and political risk for nearly 80 per cent of the financing, while Standard Chartered Bank, Saudi-based Arab Petroleum Investments Corporation (Apicorp) and the Korea Development Bank acted as pathfinder banks.

Others in the syndicate are Bahrain’s Ahli United Bank, Spanish banking group Banco Santander, the Netharlands’ ING Bank as well as French entities - Crédit Agricole Corporate and Investment Bank, Natixis and Société Générale.

Bahrain LNG, which is set for completion in 2019 will have a capacity of 800 million standard cubic feet a day.

It is jointly owned by Bahrain’s Nogaholding and a consortium consisting of US-based Teekay LNG Partners, Kuwait’s Gulf Investment Corporation and South Korea’s Samsung C&T.

It will comprise a floating storage unit, an offshore LNG receiving jetty and breakwater with an adjacent regasification platform, subsea gas pipelines from the platform to shore, an onshore gas receiving facility as well as an onshore nitrogen production facility.

The project is set to meet peak seasonal gas demand and industrial growth in Bahrain as well as enable the kingdom to procure internationally-traded LNG on a competitive basis.