UK Export Finance (UKEF) has provided a US$34.8mn loan to the Kurdistan regional government to finance a contract with UK water engineering company Biwater.

Biwater will deliver water and wastewater treatment solutions for the cities of Erbil and Sulaimani in an effort to support the current infrastructures that rely on groundwater reserves.

The UKEF loan is being issued under a direct lending facility and will finance the preliminary scoping phase of the project. JP Morgan will act as mandated lead arranger.

The scoping phase will cover social and environmental impact assessments, relevant site surveys and detailed designs and is expected to take between six and 12 months.

Commenting on the deal, UK minister for trade and investment, Greg Hands, says: “The project will bring much-needed benefits to Kurdistan and also offer substantial opportunities for supply chain companies based here in the UK.”