Oman LNG, a joint venture set up to exploit Oman’s natural gas reserves, is planning a bond issue this year, bankers say. The company has already arranged a $2,000 million package of loan and export credit agency financing, but the money has not been drawn down.
Oman LNG itself is tight-lipped on the issue. ‘I would not deny that we are contemplating it,’ says a senior official. Officials at the project’s financial advisers, Chase Manhattan of the US, were not immediately available for comment. Bankers say a number of banks have been approached about the issue, but it is not clear when it might take place or what its size might be. The model is clearly Qatar’s Ras Laffan LNG Company (Rasgas), a similar project which raised $1,200 million through an international bond issue at the start of this year, in tandem with a package of bank and export credit agency finance. The bank financing for Oman LNG was arranged by NatWest Markets of the UK and ABN AMRO of the Netherlands.
A bond issue has been on the cards since Oman LNG approached ratings agencies for a credit rating earlier this year. The project has a number of features likely to appeal to international bond investors: its shareholders include the Royal Dutch/Shell Group and Total of France and it has a sales and purchase agreement with a Korean buyer, though another sales contract with Thailand is still under negotiation. Oman is rated at investment grade by Moody’s Investors Service and Standard & Poor’s, and the country’s debut sovereign Eurobond issue, worth $225 million, was well received by the markets (MEED 2:5:97).