PETRORabigh signs landmark financing facilities worth $5.8 billion
Posted: 06 March 2006
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PETRORabigh, a joint venture between Saudi Aramco and Sumitomo Chemical, has signed financing agreements to develop the western coast of the Saudi Arabia.
 The facilities which totalled $5.8 billion were signed with Japan Bank for International Cooperation, Public Investment Fund of Saudi Arabia and 17 financial institutions.
The project entails the development of an integrated refinery and petrochemicals complex at the site of the existing Rabigh refinery at an approximate capital cost of $9.8 billion.
The project promises to make the Rabigh complex one of the most highly competitive refining and petrochemical operations in the industry.
Upon completion, the Rabigh complex will be one of the world’s largest export-oriented refinery and petrochemical complexes. The Rabigh complex will produce 18.4 million tonnes per annum of high value petroleum products and 2.4 million tonnes per annum of ethylene- and propylene-based petrochemical derivatives.
This complex will not only be a pioneering venture but will also be complementary to the development of a new economic city currently being planned by the government of Saudi Arabia.
This will provide the scope for PETRORabigh to contribute to the growth of employment opportunities and economic diversification within the Kingdom, and will also serve to help strengthen relations between Saudi Arabia and Japan.
The financing facilities signed by PETRORabigh comprise:
A loan in the amount of $2.5 billion provided by JBIC
A loan in the amount of $1billion provided by PIF
A loan in the amount of $1.7 billion provided by a group of commercial banks acting as Mandated Lead Arrangers
Financing in the amount of $600 million (the “Islamic Facility”) provided by a group of banks and Islamic financing institutions acting as Islamic Mandated Lead Arrangers
The PETRORabigh financing represents a landmark financing. The prominent role of JBIC and PIF demonstrates the importance that both the governments of Japan and the Kingdom of Saudi Arabia attach to the Project. Further, the level of participation from the conventional banks and the Islamic Institutions (including the Islamic Development Bank) reflects the high vote of confidence in the project as well as in the Sponsors.
The Islamic Facility is the largest to date in any project finance transaction.
Sumitomo Mitsui Banking Corporation and Sumitomo Mitsui Banking Corporation Europe Limited acted as Financial Advisor to the Sponsors.
HSBC Saudi Arabia Limited acted as Financial Adviser to the Sponsors in respect of the Islamic Financing.
The Mandated Lead Arrangers and Islamic Mandated Lead Arrangers are listed below:
Commercial Bank Facility
Arab Petroleum Investments Corporation (APICORP)
The Bank of Tokyo-Mitsubishi UFJ, Ltd.
Banque Saudi Fransi
BNP Paribas
Calyon
Citibank N.A.
Gulf International Bank B.S.C.
HSBC
Mizuho Corporate Bank, Ltd.
Riyad Bank
The Saudi British Bank “SABB”
Saudi Hollandi Bank
Sumitomo Mitsui Banking Corporation
The Sumitomo Trust & Banking Co., Ltd.
WestLB AG, London Branch
Islamic Facility
Arab Petroleum Investments Corporation (APICORP)
Bank Albilad
Calyon
Citibank N.A.
Gulf International Bank B.S.C.
Islamic Development Bank
Riyad Bank
The Saudi British Bank “SABB”
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