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PT2SB signs financing agreement

Published by , Senior Editor
Tanks and Terminals,

PT2SB has signed a US$1.25 billion senior financing agreement with a banking syndicate of nine international banks.

PT2SB is a joint venture between Petroliam Nasional Berhad (Petronas), Dialog Group Berhad (Dialog), The state of Johor (SSI) and Royal Vopak.

The financial facilities will be used to finance the PT2SB industrial terminal in Pengerang, State of Johor, Malaysia. The construction of PT2SB started in early 2015 and is scheduled for commissioning in various phases during 1H19.

This industrial terminal will predominantly serve the Petronas Refinery and Petrochemicals Integrated Development project (RAPID) as its main customer.

PT2SB will have an initial storage capacity of 1.65 million m3 for crude, refined products, petrochemical products and LPG. The marine infrastructure includes 12 berths. The draft of 24 m can also accommodate very large crude carriers.

The project costs are estimated around US$1.6 billion, of which approximately 20% will be funded with equity contributions by the shareholders and approximately 80% is provided in the form of project financing through the abovementioned banking syndicate.

The financing facilities will have a final maturity of 15 years with a repayment schedule that starts after commissioning. The financing is initially based on variable interest rates and PT2SB will enter into financial hedge instruments to materially reduce the potential interest exposure.

Jack de Kreij, Vice-Chairman of the Executive Board and CFO of Vopak, said: "We are proud that we have been able to secure the financing for this flagship project and we are very pleased with the commitment demonstrated by nine relationship banks participating in the financing of this project. This capital efficient funding of the project also creates significant additional financial flexibility for our company."

The syndicate of banks consists of AmInvestment Bank, DBS, ING Bank, Maybank, MUFG, Natixis, OCBC, SMBC, and UOB. These banks all acted as Mandated Lead Arrangers.

SMBC acted as financial advisor and Allen & Overy acted as International legal advisor with PNC as Malaysian counsel to PT2SB. The syndicate of nine banks were advised by Norton Rose Fulbright as International counsel and ASL as Malaysian counsel.

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