Nigeria’s Seven Energy International has signed a US$225mn syndicated facility for the Akwa Ibom gas pipeline project.

The medium-term loan was extended by FBN Capital (global co-ordinator, financial modelling bank and financial advisor to the borrower), First Bank of Nigeria, United Bank of Africa, FCMB and Stanbic (joint mandated lead arrangers), to Seven Energy’s wholly-owned gas company Accugas.

The facility will be used to refinance the existing US$55mn debt secured for the Akwa Ibom gas pipeline project, with the extra US$170mn part-financing the cost of expanding its gas processing facilities and building a new gas pipeline to supply gas to the 560MW Calabar national integrated power project (NIPP) power plant.

The second phase in Accugas’s programme, aiming to bring the gas reserves from the south east Niger Delta to market to meet growing demand, the Calabar project involves the construction of a 37km gas pipeline from the Uquo gas field to Oron. The new pipeline is scheduled to be completed in July 2014.

Seven Energy CEO Philip Ihenacho says: “The successful signing of the Accugas financing clearly shows the confidence that the financial institutions have in Accugas and Seven Energy, as well as the prospects for the Nigerian gas market.”

The firm’s chief financial officer, Bruce Burrows, adds: “The completion of the Accugas financing marks a major milestone in the project’s evolution. With construction of the Ibom gas pipeline (phase one) now complete and on track to deliver gas to Ibom power plant from April 2013, we are now embarking on phase two with construction of the Calabar gas pipeline already commenced.”

Bashirat Odunewu, executive vice-president of institutional banking, First Bank of Nigeria, comments: “The project is uniquely aligned with the federal government’s vision of harnessing the nation’s immense gas reserves, and developing the country’s domestic gas supply infrastructure.”