Oman's Duqm secures $4.61bn in multi-source financing

The facilities were provided by 29 financial institutions
Oman's Duqm secures $4.61bn in multi-source financing
The Duqm refinery is designed to be able to process a range of blended crude oils and is configured as a full-conversion hydrocracker and coking facility.
By Bernd Debusmann Jr
Sun 04 Nov 2018 09:26 AM

A $4.61 billion multi-source project financing has been achived for Oman’s Duqm refinery project, a joint venture between the Oman Oil Company and Kuwait Petroleum International, it has been announced.

The Duqm project, which is located in the Duqm special economic zone (SEZAD) along the sultanate’s south-east coast, comprises the development, construction and operation of the refinery, on-site utilities, infrastructure and storage together with offsite facilities such as crude tank storage, an 80 km crude oil pipeline to the refinery and a product export terminal.

“The $4.61 billion multi-sourced financing signed for the project is not only the largest project financing in the sultanate of Oman. It also includes the largest Shariah-compliant facility to a green field project in Oman provided by a consortium of Islamic financing institutions,” said Mubarak Al Naamany, the project’s chief financial officer.

Al Naamany added that “these facilities provided by 29 reputed financial institutions from 13 countries and insurance and guarantees (cover) provided by three major export credit agencies, is a testament of the confidence placed by international, regional, and local lenders on the sultanate of Oman, the shareholders, and the project”.

The facilities include an international commercial facility, an onshore commercial facility, an Islamic facility, and facilities covered by UK Export Finance, Spain’s CESCE, South Korea’s K-EXIM and a K-EXIM direct facility.

According to officials, the project is the first major cross border refinery project in the Middle East, as well as the first joint venture in the region between government-owned oil companies.

Additionally, it is the first refinery in the Middle East to process crude from another regional country on a long-term contractual basis.

The refinery is designed to be able to process a range of blended crude oils and is configured as a full-conversion hydrocracker and coking facility. Engineering, procurement and construction of the project is being undertaken under three lump sum turn-key contracts, with formal notice to proceed having been issued in June.

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