Egypt inks $200 mln loan deal to finance Suez refinery

Egypt has signed a $200 million loan agreement with the European Bank for Reconstruction and Development (EBRD) to support investments in the Suez Oil Processing Company’s (SOPC) oil refinery, the Ministry of Investment and International Cooperation announced Wednesday.

The plant has a refining capacity of 68,000 oil barrels per day (bpd) and is located at the entrance of the Suez Canal. It is operated by the Suez Oil Processing Company, a subsidiary of the state-owned Egyptian General Petroleum Corporation (EGPC).

“The EBRD funds will finance the modernization of the refinery to update technology and improve operational performance. The upgrade will increase the flexibility of the plant’s crude intake and allow for the production of higher quality fuels and low sulphur fuels,” the bank said in a statement.

It added that the refinery will undergo an extensive energy efficiency program, which will lead to a direct reduction of over 295,000 tonnes of carbon dioxide emissions each year and estimated yearly savings of 300,000 megawatt hours (MWh) of energy and 384,000 cubic meters of water.

Eric Rasmussen, EBRD Director, Natural Resources, said the project reflects the bank’s commitment to support Egypt and its sustainable and successful development.

“The project will contribute to one of the country’s main priorities in the ongoing oil and gas sector reform effort which is to optimize downstream performance and energy efficiency,” Tarek El Molla, the Egyptian Minister of Petroleum and Mineral Resources, said.

He added that the $200 million loan that will be provided by EBRD will support the sector-wide modernization and reform program which aims at reducing the fiscal deficit, attracting private sector capital and establishing a role model for improving public sector governance in Egypt.

EBRD’s investments in Egypt amount to €2.7 billion ($3.2 billion), with a total of 78 projects.