Dubai is expected to finalise by mid-April the $2.5bn funding for the construction of the Route 2020 metro link, the line connecting the existing infrastructure to the Dubai Expo site in Jebel Ali area.

The loan financing will be extended to a special purpose vehicle set up for the project which is backed by the emirate’s Department of Finance (DoF), banking sources familiar with the matter said, adding that documentation and final discussion are currently taking place, which should be completed within a week or 10 days.

MEED, in August, reported that DoF had been tasked with arranging the financing and that it was speaking to banks for the commercial loan tranche.

The scheme, which will cost about $2.9bn, will have a debt component of $2.5bn, of which about $1.5bn is backed by export credit agencies (ECAs) and the rest by a conventional commercial loan.

UK’s HSBC and Standard Chartered, Spain’s Intesa, Chinese Industrial and Commercial Bank of China and local Abu Dhabi Commercial Bank are among the lenders involved in the financing, according to sources.

The commercial part of the financing is likely to be priced 200 basis points over the London interbank offered rate (Libor), source said. Earlier reports suggested that the ECA-backed funding is expected to offer about 150 basis points over Libor.

Mattar al-Tayer, chairman and director-general of Dubai’s Roads and Transport Authority (RTA), the developer of the scheme, in August said that the government has already made an advance payment of AED600m ($165m) to the consortium of contractors that won the deal to build Route 2020 in June 2016. The team includes France’s Alstom, Spain’s Acciona and Turkey’s Gulermak.

RTA had hoped that the financing will be in place before end of 2016, “I hope it will be before the end of this year as we have started construction,” he had told media at the time.

Route 2020 involves building a 15-kilometre-long line branching off the existing Red Line at the Nakheel Harbour & Tower station, between the Ibn Battuta Mall and Jumeirah Lake Towers stations. The line will also connect to Al-Maktoum International airport. About 11km of the line will be elevated, with five elevated stations and two underground stations.