EBIC To Hold Bank ‘Beauty Pageant’ For Petrochemicals Complex In Q3
Egypt Basic Industries Corporation (EBIC) plans to hold a ‘beauty pageant’ to secure a financial advisor for its planned $3.9bn petrochemicals complex in the third quarter, the company’s Chairman and CEO Basil El-Baz told MEES. The project will include a 2.5mn tons/year naphtha cracker and 1mn t/y polyethylene complex, producing 450,000 t/y of propylene, 1mn t/y ethylene, 400,000 t/y of pyrolysis gasoline, 450,000 t/y of fuel gas and mixed C4s, 500,000 t/y high density polyethylene (HDPE) and 500,000 t/y of low density polyethylene (LDPE). The debt/equity split is expected to be 75:25 and mandated lead arrangers for the financing will be appointed in the first quarter of 2009.
“Contribution by export credit agencies will be vital and with a project of this size we may find ourselves dealing with multiple ECAs,” said Mr Baz. The front-end engineering and design (FEED) contract will be awarded in the third quarter. Located in ΄Ain Sukhna, the project will use Kellogg Brown and Root (KBR)/ExxonMobil proprietary core technology. Naphtha supplies will come from an internationally recognized supplier, and product off-takers will be both local and international consumers, he said, speaking at the ICBI Projects International conference in Paris on 21 May. This complex will be EBIC’s third project and will follow two greenfield anhydrous ammonia plants. Construction on the first is completed and it will be commissioned in June (see EBIC Mulls Expansion As Ammonia Plant Construction Proceeds, MEES, 7 May 2007). In March this year the project was re-geared, with debt increased by $50mn, and US Exim providing $5mn and banks the remainder, pushing up the debt/equity ratio from 65:35 to 70:30.
EBIC is planning a second anhydrous ammonia plant, also in ΄Ain Sukhna, which will include two units, both producing 2,200 t/d of ammonia. It will be the largest single ammonia production facility globally, said Mr Baz. It will implement KBR technology using magnetite as opposed to the CAP process which uses a ruthenium catalyst which has become prohibitively expensive. The gas supply will be from the designated governmental entity and the off-taker is Transammonia on a take-or-pay basis. Société Générale (SG) is the financial advisor on the project, which will cost $1.6bn (with equity at $475mn and debt is at approximately $1.1bn). MLAs have been appointed and comprise Fortis, HSBC, SG, and West LB. Sell down will take place after financial close, and EBIC has received a letter of interest from US Exim and is due to the submit the final application to the US ECA this month. Exim was a key provider of finance to the company’s original project.
Copyright MEES 2008.
