Saudi Arabia’s Polysilicon Technology Company (PTC) is expecting bank commitments for the debt tranche of its $550m polysilicon project by late August and is aiming to reach financial close by the end of the year.

The project, a joint venture of the local Mutajadedah Energy Company and South Korea’s KCC Corporation, is looking for about $400m of debt. This is expected to come from a small group of local banks.

One source close to the project says the banking group will probably be between two to four banks. Several large banks in Saudi Arabia are understood to have already declined to get involved in the deal. They are concerned about backing the first project of its kind in Saudi Arabia and also the diverse ownership structure of the sponsors. Mutajadedah is owned by a group of Saudi investors, including financial advisory firm Swicorp and Chemical Development Company (MEED 15:04:11).

“There is already a group of banks working on this deal,” says a source close to the project.

Once completed, the project will have initial capacity of 3,350 metric tonnes of polysilicon, which will be used in the production of solar panels. KCC has agreed to buy all the polysilicon produced.