Banks have been asked to respond by 9 September to the preliminary information memorandum (PIM) on the debt package for the Sohar aromatics project, being developed by Oman Oil Company (OOC), Sohar Refinery Company (SRC) and South Korea's LG International. HSBCis acting as financial adviser (MEED 22:4:05).
The sponsors are looking for close to $800 million in debt financing, with a commercial tranche of $385 million, a $192.5 million tranche covered by Export-Import Bank of Korea (Kexim) and a $192.2 million direct loan from Kexim. However, banks are also being asked to consider the possibility either of a fully commercial package or a 50:50 split between the commercial and direct loan portions. The tenor of the financing will be 12 years, with a 15 per cent balloon repayment mechanism. Banks have been asked to bid for a minimum ticket of $55 million, reflecting the aim of the sponsors to appoint a mandated lead arranger (MLA) group of at least eight banks. The likelihood is that it will end up as a club deal. MLAs are due to be appointed on 16 September, with financial close reached by the end of November, leaving the way open for financing to begin on the Sohar aluminium smelter. The planned plant will have capacity of 800,000 tonnes a year (t/y) of paraxylene and 210,000 t/y of benzene. Total project costs are about $1,100 million. OOC holds 60 per cent of the project company and SRC and LG each own 20 per cent.