Banks have been invited to respond by 21 October to the request for proposals (RFP) on the debt package for the Sohar aluminium smelter. Bidders have been requested to underwrite at least 50 per cent of the $1,500 million financing. Citigroupis acting as financial adviser (MEED 25:2:05).
The proposed package will include $1,200 million in conventional debt and a $260 million Islamic tranche, both with a tenor of 15 years. However, the sponsors ? Oman Oil Company (OOC), Abu Dhabi Water & Electricity Authority (ADWEA) and Canada?s Alcan? are in discussions with Export Development Canada about providing funding for the project, in which case the commercial finance portion will be reduced. The facility will have a 30 per cent balloon repayment and a 100 per cent cash sweep mechanism in year 10.
Under the proposed financing schedule, bank meetings will be held in London in the second week of October. Mandated lead arrangers (MLAs) will be shortlisted on 4 November and appointed the following week, with the deal due to be signed on 30 November and first drawdown in mid-December.
Total project costs are estimated at about $2,400 million, of which about $460 million will cover the 600-MW power island. The single potline smelter, due for completion in 2008, will have initial capacity of 325,000 tonnes a year. OOC and ADWEA each have a 40 per cent stake in the scheme, while Alcan holds the remainder. The US? Bechtelis the engineering, procurement and construction management (EPCM) contractor (MEED 9:9:05).