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RLPC-Saudi Jubail refinery financing oversubscribed-sources
* More than 30 banks interested in financing refinery
* Bank financing almost 80 percent oversubscribed
* Project sponsors will now decide on debt structure
By Christopher Mangham
LONDON, Oct 13 (Reuters) - State oil company Saudi Aramco and French oil major Total (TOTF.PA) have received bids from more than 30 banks to finance a $12.8 billion refinery in Saudi Arabia, banking sources close to the deal said.
The Jubail oil refinery will be funded through a 65 percent debt and 35 percent equity ratio. The total financing is expected to be $8 billion, which will be the largest Gulf project financing in 2009.
The bank financing is almost 80 percent oversubscribed and the sponsors will now decide on how best to optimise the financing structure before financial close in December, one of the bankers said.
As previously reported by Reuters Loan Pricing Corp in July, the bank financing had initially envisaged including an uncovered 16-year bank tranche worth around $1.4 billion, and a Saudi tranche for the same amount.
"The sponsors are now choosing the structure and the response from banks means they have a lot of options," one of the bankers said.
Further funds will be provided as direct loans and guarantees totalling more than $3 billion from export credit agencies JBIC, NEXI, KEXIM, KEIC and SACE, sources told Reuters LPC in July. [ID:nLS19740]
There will also be funds from Saudi government-backed Public Investment Fund (PIF) and Saudi Industrial Development Fund (SIDF), the sources added in July.
The 400,000 barrels per day (bpd) refinery will be commissioned end-2012 and is expected to come online in March 2013, Daniel Lacombe, Jubail Refinery's project director told Reuters on Monday. [ID:nLC377613]
Funding for the refinery, which also includes a 700,000 tonnes per year (tpy) petrochemical plant, may also come from a sukuk issue that could be launched in 2010, Lacombe added. Currently, Saudi Aramco has a 62.5 percent stake in the project while Total has 37.5 percent.
Calyon is acting as financial advisor to the project. (Editing by Jon Loades-Carter)
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