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Kuwait seeks $2.6bn loan for LNG terminal
May 31, 2018

MEED

State-owned operator will use the money raised to develop the project in the Al-Zour master development.

The Kuwait Integrated Petroleum Industries Company (KIPIC) is looking to borrow up to $2.6bn from banks and export credit agencies to build its planned liquefied natural gas (LNG) import terminal in Kuwait, according to a report.

State-owned Kuwait Petroleum Corporation’s subsidiary KIPIC will use the money raised to develop the terminal at Kuwait’s Al Zour complex, which also has a refinery and a petrochemical facility.

Japan’s Sumitomo Mitsui Banking Corporation is advising KIPIC on the financing, which will also include a loan denominated in Kuwaiti dinars and backed by local banks, according to a Reuters report.

The $2.6bn international debt facility, with a maturity of around 15 years, is coordinated by four banks, and will partly be backed by the Export-Import Bank of Korea and Korea Trade Insurance Corporation, according to the report.

The local loan will be worth up to $800m, with Islamic and conventional tranches, it said.

Kuwait Finance House is leading the Islamic tranche and National Bank of Kuwait the conventional one, with Gulf Bank and Commercial Bank of Kuwait also involved.

KIPIC is seeking to build the LNG import and regasification terminal at Ahmadi, the purpose of which would be to supply the feed for power generation in Kuwait during peak electricity demand period.

The project is meant to consist of two berths for simultaneous large LNG carriers unloading, four full containment LNG tanks and a regasification plant There will be provisions for a future second phase that will increase the regasification capacity and will include construction of four additional LNG tanks of the same size.

A South Korean consortium of Hyundai Engineering, Hyundai Engineering & Construction and Korea Gas Corporation are executing the engineering, procurement and construction of the project. The project is expected to be completed in 2020.

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