The European Bank for Reconstruction and Development (EBRD) is supporting the diversification of the economy in Azerbaijan with a US$120mn loan to Azerbaijan Methanol Company (AzMeCo).
The loan will be used to finance AzMeCo's construction of a methanol plant in the Karadagh region of Azerbaijan, south of the capital Baku.
This is the first methanol project to be financed by the EBRD, and the bank’s largest investment to date in a locally-owned company in Azerbaijan.
With total costs of US$330mn, the project is co-financed by the International Bank of Azerbaijan. A part of the EBRD loan will be syndicated under the bank’s A/B structure.
The plant – with production capacity of 561,000 tonnes of methanol per year – will add value to Azerbaijan’s important reserves of natural gas by converting country’s natural gas into methanol for export.
“The EBRD is pleased to support this important project for Azerbaijan’s industrial sector. The new methanol plant will stimulate the development of petrochemical industry, which will generate more investments and new employment opportunities in the country,” says Kevin Bortz, EBRD director for natural resources.
“The EBRD will continue its cooperation with AzMeCo to support the development of the company, and we are open to examine further financing for the next stages of the project,” Bortz continues.
Since the beginning of its operations in Azerbaijan, the EBRD has committed over US$1bn across more than 90 projects in corporate, financial, infrastructure and energy sectors.
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