12 August 2010 10:16 [Source: ICIS news]
By Pearl Bantillo
SINGAPORE (ICIS)--SK Energy and ?xml:namespace>
"They decided to step up their investment," the company source said.
The South Korean company had tripled its interest in JAC to 30% in recent months while Sanfangxiang now controls a quarter of JAC from 10% previously, after Kuwaiti investor Noor Financial decided to pull out of the project, the company source told ICIS.
SK Energy is the project leader for the planned aromatics complex, according to Dongkeun Lee of SK Energy International, a unit of the South Korean energy group.
Global commodity trader Glencore, which is among the original investors in JAC, "is still mulling its 10% stake in the project", the JAC source said. The Economic Development Board (EDB) of
He declined to say whether a new investor will come into the scene, saying: "Some of them are still going through final approval."
JAC had changed its equity structure over the past three to four months as it prepares to obtain credit to be able to proceed with its 1.5m tonne/year aromatics project in
There is no immediate plan to raise the company's current capital at $550m, and the rest of the funding would have to be obtained through debt, he added.
Based on the original plan, construction of project was to begin in late 2008, but JAC hit a funding snag as credit markets virtually closed with the collapse of
ING is the financial adviser of JAC, while Royal Bank of Scotland (RBS) is its lead banker, the source said.
"The credit market has improved since Lehman['s collapse]," he said.
JAC now hopes to complete its financing requirement by the end of this year and to kick off project construction in 2011.
"It's a good time to raise credit and a good time to build [the facility] because by the time it is completed in 2014, most people were predicting an upswing in the petrochemical cycle," the source from JAC said.
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