Brazilian oil company Petrobras has secured a US$1bn line of credit with a syndicate of four banks comprising of BBVA, Citi, HSBC and Santander.

The facility is to be backed by the UK export credit agency, UK Export Finance (formerly known as ECGD). The proceeds of the facility will finance the charter of several oil ships from UK companies.

According to a source close to the transaction, all the documentation related to the transaction has been signed, and the facility is just pending final sign-off from the export credit agency.

Under the terms of the deal structure, the financing is not linked to a single commercial contract, but acts as a framework agreement. The facility provides cover and financing for multiple commercial contracts entered into by Petrobras with British suppliers. Petrobras and the ECA are in the process of identifying suitable contractors.

The loan has a 12-year tenor and is disbursed over two years on a contract-by-contract basis, and repaid over 10 years.

The banks will reimburse Petrobras on each contract, and it is thought there will be sufficient contracts to make use of all of the facility.

MLAs Citi, HSBC and Santander all contributed US$266.66mn to the facility while BBVA contributed US$200mn. HSBC acted as facility and documentation agent. Petrobras has signed previous loan agreements with ECAs, including facilities with Korea’s K-Sure in 2010 and with Denmark’s EKF and US Exim.

Earlier this year the oil company launched a supply chain programme to boost credit to its suppliers. Brazil’s Banco do Brasil, Bradesco, Caixa Economica Federal, Itau and international banks HSBC and Santander set up the programme in early June.

Petrobras is in need of increased and diversified sources of investment to help fund its expanding exploration and production activities after the company made significant oil reserve discoveries in 2010 and 2007.

Last September Petrobras raised a record US$70bn IPO to help fund its growth plans.