Methanol finance sought

02 November 2002

A team of the local OmzestGroup, Oman Oil Company (OOC)and Germany's Ferrostaal is evaluating options for the financing of its proposed 5,000-tonne-a-day (t/d) methanol plant, which is planned for construction in Sohar Industrial City.

The estimated $400 million-500 million project will be financed by a 70:30 debt/equity package. The debt is expected to be a combination of export credits and a commercial loan. German export credit agency Hermes and development bank Kreditanstalt fuer Wiederaufbau (KfW) are expected to play key roles.

Shipments of the first methanol from the plant, which will be lifted by the European offtaker Vitol Holding, are scheduled to begin in 2005 (MEED 27:7:02). Ferrostaal, which is part of Germany's MANgroup, is also acting as the general contractor for the scheme. The company is in the process of completing its initial engineering studies for the plant, with construction work expected to begin in 2003 (see Special Report).

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