Emirates Aluminium Company (Emal) has closed a US$4.9bn limited-recourse bank financing to support an aluminium smelter project in Al Taweelah in Abu Dhabi. The project marks the entry of Abu Dhabi into the global aluminium industry.
Emal is a joint venture between Mubadala Development Company and Dubai Aluminium.
The deal consists of a US$1.8bn 16-year term loan, a US$270mn letter of credit facility, and a US$2.8bn six-year equity bridge loan.
A further US$2bn is expected to be raised in the credit markets during the construction of the smelter, bringing the total financing to US$7bn. This will make it the largest single commercial financing to date to be raised in support of a project in the Gulf.
Financial advisors to Emal were Citigroup and law firm Sullivan and Cromwell. A syndicate of international and regional banks arranged the financing, and this was led by Abu Dhabi Commercial Bank, BNP Paribas, Calyon, Royal Bank of Scotland, Standard Chartered, SMBC, Citigroup, Emirates Bank International, Export Development Canada (EDC), Export Finance and Insurance Corporation (EFIC), Goldman Sachs Credit Partners, Mashreqbank, and National Bank of Abu Dhabi.
This financing is for the first phase of Emal's planned aluminium smelter, to be capable of producing 700,000 tonnes per year of aluminium, and to be constructed at the Khalifa Port and Industrial Zone in Abu Dhabi.
Once the additional pot lines have been completed during the second phase, Emal will be the largest single aluminium smelter in the world, and will have a total annual production capacity of 1.4mn tonnes of aluminium.
Site works have already begun on the first phase of the smelter, and it is scheduled to start production in 2010.
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