'We are a very strong candidate for a successful refinancing,' says Yuvraj Narayan, SPS' chief financialofficer. 'No one has been mandated yet but we have been talking to banks and testing the waters. We would hope to bring a deal to market by April or May.' Bankers say the success of the Salalah port development will attract aggressive bids for a refinancing mandate.

The original facility - initially worth $77.6 million before it was increased to $99 million - was arranged in 1997 according to the typical greenfield non-recourse project finance model (MEED 19:12:97).

'The construction risk is no longer there. Salalah is no longer a greenfield project and we would like to have some of the terms and conditions relaxed,' says Narayan. 'We would like to move more towards a commercial lending agreement.'

With about $65 million of the original facility still outstanding, SPS would be seeking to raise about $35 million as part-financing for its proposed expansion. Formal approval for the scheme is expected from the government before the end of January (MEED 2:11:01, Transport).