Saudi Arabia’s Ports Development Company (PDC) has reached a financial close on a SR2.7bn ($720m) project finance deal.

MEED reported in September that PDC had signed the Islamic facility with local Arab National Bank and Sabb.

The facility will fund the second phase King Abdullah Port. This involves the expansion and development of the port’s southern basin, which includes an additional container terminal, a roll on-roll-off terminal and a bulk cargo terminal. It will increase the port’s total capacity to 6 million twenty-foot equivalent units (TEU) annually. The port’s logistical support area will also be developed

The collateral on the loan is the port’s land. It has a tenor of 14 years.

PDC is a joint venture between Emaar the Economic City, a subsidiary of the Dubai developer and Huta Marine Works, a subsidiary of local Saudi Binladin Group.

UK law firm DLA Piper advised PDC on the transaction.

King Abdullah Port is part of the King Abdullah Economic City (KAEC) in Rabigh.

Saudi Arabia’s Public Investment Fund is negotiating to buy a stake in the development as the kingdom restructures its economy on the back of lower oil prices.