Saudi Ma’aden gets initial approvals of $4.2bn for phosphate project

26 December 2013 05:08  [Source: ICIS news]

KARACHI (ICIS)--Saudi Arabian Mining Company (Ma’aden) received initial approval of Saudi riyal (SR) 15.75bn ($4.2bn) from banks and financial institutions to fund a phosphate project of Waad Al Shamal, Ma’aden said on Wednesday.

“It [the company] has received financing commitment letters from local, regional and international banks and financial institutions for up to SR15.75bn, $4.2bn. This is to fund the development and construction of Ma’aden’s Waad Al Shamal Phosphate Project,” the company said in a statement issued to Saudi stock exchange.

“The loans will be for a period of 17 years and will be repaid in half yearly installments starting from 31 December 2018,’ it added.

Earlier in the week, Ma'aden had awarded three contracts worth a combined SR8.46bn to Canadian and Asian companies to build phosphate mining and production.

Canada's SNC Lavalin and China's Sinopec Engineering Group have won a SR2.86bn contract to build a power plant and a sulphuric acid plant which has a production capacity of 4.9m tonnes/year.

South Korea's Hanwha Engineering & Construction Co won a contract to build a phosphoric acid plant worth SR3.5bn. The plant will have a production capacity of 1.5m tonnes/year.

China Huanqiu Contracting & Engineering Corp Co won a contract to build an ore beneficiation plant worth SR2.08bn with a production capacity of 5.3m tonnes/year.

Ma’aden said the $4.2 billion commitments represent the financing portion from commercial banks and financial institutions, while the remaining debt funding will be secured from the Public Investment Fund, the Saudi Industrial Development Fund and Export Credit Agencies.

“The company is expected to obtain all the commitments by end of January 2014,” it said without giving total project cost.

“The partners and the project financial advisor, expect to sign definitive financing agreements in Q2 2014.”

The project in Waad al-Shimal City in the north of the country is a joint venture between Ma'aden, Saudi Basic Industries Corp (Sabic) and Mosaic. Maaden owns 60%, Mosaic 25% and SABIC 15% in the project.

($1 = SR3.75)

By: Aamir Ashraf

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