GS in line for Sohar

13 January 2006
South Korea's GS Engineering & Construction is due to sign by early 2006 two contracts worth a total of about $1,800 million for the planned aromatics and ethylene dichloride (EDC) projects at Sohar. Mandated lead arrangers (MLAs) have already been appointed on the aromatics debt package (MEED 23:9:05).
The larger of the two lump-sum turnkey (LSTK) contracts, worth $1,000 million, will be for the construction of a 760,000-tonne-a-year (t/y) paraxylene unit and a 210,000-t/y benzene plant. France's Axensis the licensed technology provider and is carrying out basic engineering, while the US' Jacobs Engineeringhas the front-end engineering and design (FEED) package. Naphtha feedstock will be sourced from Sohar refinery. The project is being developed by Oman Oil Company, Sohar Refinery Company and South Korea's LG International. The contract with GS is being directly negotiated. A 14-strong group of MLAs has been appointed on the $400 million commercial debt package for the project. Export-Import Bank of Korea (Kexim) is providing a direct loan of a similar amount. Financial close is scheduled in November.

The second contract, worth $800 million, will be for the 300,000-t/y EDC and 240,000-t/y caustic soda units. The project is being handled by the local Liwa Petrochemical Company. Germany's Uhde is the technology and equipment supplier. HSBCis financial adviser on the estimated $300 million debt package, with the preliminary information memorandum (PIM) due to be launched soon. Both facilities will take about 32 months to be built.

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