Qatar Fertiliser ditches bond sale

A shot of Qatar Fertiliser's facilities. The company is the second Industries Qatar unit to reportedly delay a bond sale.

Qatar Fertiliser, a unit of Industries Qatar, dropped plans to sell $1.2 billion of bonds after the global credit crunch made borrowing more expensive, the Middle East Economic Digest said.

The company is looking instead for project finance to pay for a new urea and ammonia plant, the London-based weekly reported in its latest issue, without saying how it obtained the information.

The global credit crunch, triggered in July by defaults on US mortgages, led Qatar Fertiliser's advisers to scrap plans to sell the bond in October "because it was getting too expensive to finance the project this way", the magazine said.

Qatar Fertiliser was considering postponing the bond sale until credit markets settled, Houssam Kharboutli, an executive of Qatar Petroleum, Industries Qatar's parent, told Reuters last month.

The bond would have financed a plant, with a capacity of 3,500 tonnes per year of urea and the same of ammonia, to be completed in 2010, Kharboutli said.

Qatar Steel, another subsidiary of Industries Qatar, said this month it had postponed plans to raise a $1.34 billion loan because of turmoil in global credit markets.

The credit crisis, which made banks around the world more reluctant to lend, may delay as much as $90 billion worth of petrochemical projects in the world's biggest oil exporting region, the Gulf Petrochemicals and Chemicals Association said this month.

The group represents 100 chemicals companies in the region.

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