Chevron agrees to $1.8bn project financing

21 November 2007

The $1.8bn project financing for the $5bn National Chevron Phillips (NCP) petrochemicals project in Saudi Arabia has been priced at a relatively low rate, despite fears about defaulting US mortgage assets increasing prices generally.

Margins on the deal start at 80 basis points over the London interbank offered rate (libor), and will rise to 115 during the 14.5 years of the loan.

Banks that have joined the financing group include Banque Saudi Fransi, National Commercial Bank, Samba, Riyad Bank, BNP Paribas, Calyon, Standard Chartered and Royal Bank of Scotland.

Financing for the deal was arranged by NCP’s in-house team. Bankers close to the deal say the team’s ability to structure the deal to international standards and use a large number of contacts helped secure attractive rates despite poor market conditions.

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