The Egyptian Refining Company (EFC) has received a US$225mn loan from development banks and ECAs to build and operate a new hydro-cracking and coking facility.
The banks involved are the African Development Bank (AfDB), the European Investment Bank (EIB) and, in the latest display of Asia’s appetite for African investment, the Korean Export-Import Bank (Kexim).
The loans are split into a US$200mn senior loan and a US$25mn subordinated convertible loan, with the option of AfDB providing a B-loan of up to US$80mn.
As well as developing the new hydro-facility, the loan will be used for ancillary units adjacent to the Cairo Oil Refinery Company’s (Corc) existing refining units, with ERC intending to use low-quality atmospheric residue from Corc as feedstock to produce 4.8 million tonnes of refined products per year for the domestic market.
Tom Thomason, chief executive officer of ERC tells GTR: “The ERC project is a classic public-private partnership between the company and the Egyptian government providing for the upgrade of an existing government refinery using the private sector to provide capital and debt financing. For Egypt, in addition to being a direct foreign investment of over US$3.5bn, the project is an import substitution project delivering much needed refined products to Cairo which is the heart of the consumption market.”
The project corresponds with AfDB’s country strategy for Egypt which focuses on supporting trade growth and infrastructure development.
Reader Comments