Jurong Aromatics Corporation’s (JAC) US$1.56 billion (S$2 billion) financing to build its Singapore petrochemical plant was signed on Wednesday, with 10 banks committing to the debt, bankers involved with the deal said on Thursday.
Some US$1.24 billion, or 80% of the debt, will be financed or guaranteed by two South Korean government export agencies for a tenor of up to 15.5 years.
“It’s a complex project with a complex commercial and financial structure and the contributions made by every party were essential to the ultimate success,” said Bruce Macfarlane, leading the financial advisory team at ING Bank. The US$2.4 billion JAC project involves the development of a condensate splitter and aromatics facility on Singapore’s Jurong Island. The plant will produce 1.5 million tonnes of aromatics and 2.5 million tonnes of transport fuels per year, JAC has said.
The plant will come on stream in 2014 with construction starting next month, the bankers said.
The 10 banks participating in the project financing include ING Bank , Royal Bank of Scotland , Intesa san Paolo, Korean Development Bank, Standard Chartered Bank, Australia & New Zealand Bank , BNP Paribas, DnB NOR Bank , Natixis and DZ Bank.
The funding for the project will be on a 60/40 debt equity ratio, with the equity being contributed up-front before the senior debt is drawn, bankers said.
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