In a milestone transaction for Cameroon, international commodities trading company Trafigura closed a two-year US$125mn syndicated export prepayment facility in October last year.

This is the West African country’s first syndicated transaction on a strict commercial basis (without the involvement of multilaterals and export credit agencies) in many years.

The facility is to be made available to Trafigura – the borrower – under a limited recourse arrangement and is ultimately in favour of Société Nationale de Raffinage, Cameroon (Sonara), through an advance purchase of petroleum products made between Trafigura and Sonara.

Sonara has been a rare borrower in the international markets, with this deal being the first syndicated transaction in favour of the Cameroonian refinery.

The syndication was launched on August 4, 2009 and closed oversubscribed with the facility amount increased from the launch amount of US$100mn.

“The deal is a benchmark in the market since it’s a syndicated deal structured for a borrower located in a West African country,” says Sabine Huet, of Société Générale’s structured commodity and mining finance division, commenting on the merits of the deal.

“It shows interest from some international banks in the African market, and it’s a via trader pre-export financing
– a structure not commonly used in the recent past.”

Funds made available under the facility will be primarily used by Sonara to finance its refinery upgrade and capacity increase project. Sonara has a current and nominal capacity of 42,000 barrels per day, to be raised to 72,000 barrels per day by 2012.

Crédit Agricole CIB (CA CIB) acting as the initial mandated lead arranger (IMLA) and sole bookrunner has been joined by Société Générale, BNP Paribas, FBN Bank (UK) and MediCapital Bank as mandated lead arrangers and by SCB Cameroon as manager for the facility, with CA CIB also taking the role of facility agent, security trustee, account bank and documentation bank.

“The success of the loan in the market results from the combination of the involved parties with Sonara and Trafigura as key counterparts, but also results from the quality of the negotiated structure with inclusion of a strong security package,” says Jean-Baptiste Ciet, associate director, Africa & Asia, natural resources, structured commodity finance at CA CIB.

“The facility has also been fine-tuned with a forward-start disbursement circa a quarter after closing, with a required independent technical engineer report to validate the restart and operational status of the refinery (following a two-month planned shutdown at the end of 2009) and to subsequently permit the drawdown (expected around mid-February 2010),” Ciet adds.

Sonara, majority-owned by the government of Cameroon, was established in 1976 and is the only refinery in Cameroon. While the main objective of the company was originally to refine crude oil and supply petroleum products to meet local demand, Sonara has more recently developed its profitable export activity, with exports now accounting for about 50% of the refinery’s production and sales.

Sonara and Trafigura have developed a strong commercial relationship since the mid 1990s, in both the supply of
crude oil to the refinery and the export of petroleum refined products from Cameroon.
Deal information


Borrower: Trafigura/ Sonara (Société Nationale de Raffinage) as beneficiary of funds
Amount: US$125mn
Initial mandated lead arranger and sole bookrunner: Crédit Agricole CIB
Mandated lead arrangers: Société Générale, BNP Paribas, FBN Bank (UK), Medicapital Bank
Manager: Société Commerciale de Banque Cameroun
Law firms: DLA Piper
Tenor: 26 months
Margin: 475 basis points
Date signed: October 23, 2009