Banks await Qatargas II PIM release

25 June 2004
The release of the preliminary information memorandum (PIM) was imminent in mid-June for the $1,500 million-2,000 million commercial loan tranche on the Qatar Liquefied Gas Company II (Qatargas II)financing. 'We have already received the confidentiality letter and we expect the PIM in a matter of days,' said a banker following the transaction on 16 June. The integrated Qatargas II project involves the delivery of 15.8 million tonnes a year (t/y) of liquefied natural gas into the UK, with the first deliveries due in late 2007 (MEED 30:4:04).

Invited banks are expected to be given four-five weeks to submit single bank bids for the 15-year loan. In keeping with recent borrowings in support of Qatari energy projects, a large leading arranging group of 15-20 banks is expected to be mandated.

At least two other tranches are expected on the financing package, which will be used to support the project costs in Qatar. The term sheets have been extensively negotiated with two export credit agencies - Italy's Sace and the US' Export-Import Bank - for an estimated $600 million tranche. An Islamic tranche of between $200 million-400 million is also planned, while a bond remains an option. The financing package for Qatargas II's receiving terminal in the UK will be arranged separately at a later date.

The financial adviser on Qatargas II is Royal Bank of Scotland; the project legal counsel is White & Case.

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