Emirates Aluminium (Emal) is planning to close the bank financing for its $4.6bn phase two expansion in March, although plans to issue a $1.25bn bond to fund part of the project look set to be delayed until later in the year.

According to sources close to the project, Abu Dhabi’s Mubadala Development Company, one of the sponsors of the scheme, plans to hold talks with the 22 banks that have agreed to fund the expansion by early March.

The talks will focus on which banks want the amount they have committed to the $2.25bn commercial bank loan for the project to be scaled back. Bank commitments to fund the project expire in mid-April unless the deal is closed.

The bank portion of the financing was so oversubscribed that Emal does not need to issue a bond to fund the project, but has previously indicated to banks that it would do so. Plans to issue a bond last year were delayed because of complications related to Mubadala’s accounting period, and sources say the bond is still unlikely to be in place by the time the bank financing is completed and may not happen until later in the year.

“It is looking increasingly unlikely that they will be ready to do the bond before the bank financing closes, so if it happens it will have to be much later in the year,” says one source involved in the deal.