Aramco's oil pipeline consortium secures $1.7 bln loan to finance new tranche of deal: Report

Logo of Saudi Aramco

The consortium that won the gas pipeline deal of Saudi Aramco secured a loan worth nearly $1.7 billion to finance the new tranche of the transaction, Al Arabiya reported, citing sources familiar with the matter.  

Led by EIG Global Energy Partners (EIG), the consortium secured the financing in two tranches; the first is valued at $910 million with a maturity of over 15 years and the second is worth $825 million, maturing in nearly 20 years.

The banks that participated in arranging the 15-year tranche included Riyad Bank, Bank of China, Korea Development Bank (KDB) and UAE's Mashreq Bank, the sources said, adding that this tranche offers a variable interest rate ranging between 180-190 basis points (bps).

Meanwhile, Saudi National Bank (SNB) and Arab Petroleum Investments Corp. (APICORP) participated in arranging the second 20-year tranche at $750 million, with a fixed interest rate at 245 bps, the sources noted.

In April 2021, Aramco signed a deal with a consortium led by EIG, one of the world’s leading energy infrastructure investors, to optimize its assets through a lease-and-lease-back agreement involving its stabilized crude oil pipeline network, according to data available with Argaam.

The Saudi oil giant will receive upfront proceeds of around $12.4 billion upon closing, further strengthening its balance sheet through one of the largest energy infrastructure deals globally.