Saudi Arabia’s Polysilicon Technology Company (PTC) has started to approach banks to finance its $500m polysilicon project under development in Jubail.

The project is a joint venture of the local Mutajadedah Energy Company and South Korea’s KCC Corporation. It will have initial capacity of 3,350 metric tonnes of polysilicon, which will be used in the production of solar panels and KCC has agreed to buy all the polysilicon produced.

A variety of international and local banks, and export credit agencies have been approached to supply the debt funding for the project, which is expected to be about 75 per cent of the total project cost.

“The size of this project, and with Saudi names behind it, mean this is the kind of deal the local banks can easily finance. It is more difficult for international banks to compete with the kind of pricing that Saudi banks can offer,” says one Riyadh banker.

Another source close to the project adds: “Although a lot of banks have been invited, given the liquidity in Saudi banks it is likely they do the bulk of the funding, if not all of it.”

Germany Deutsche Bank is acting as financial adviser to the project sponsors. Mutajadedah is owned by a group of Saudi investors including financial advisory firm Swicorp, and Chemical Development Company.

Several projects in the polysilicon sector are planned in Jubail, including the Saudi Polysilicon scheme planned by Bahrain’s First Energy Bank.