Oman Oil Company Exploration & Production LLC (“OOCEP”) has announced the successful signing of a US$ 1 billion loan facility to fund its continued growth and expansion. The new financing agreement is structured as a crude oil pre-export facility with a tenor of 5 years and contains an accordion option to allow additional funding of US$ 500 million if required. The transaction attracted keen interest from the global finance community and closed heavily oversubscribed by a group of international banks, priced at 170 basis points over the London Interbank Offered Rate (LIBOR).
Commenting on the formal announcement of the new financing facility for OOCEP, Eng. Isam Al Zadjali, Chief Executive Officer of Oman Oil Company (“OOC”) noted, “We are delighted with the strong response and competitive pricing achieved in this OOCEP inaugural external financing, despite challenging market conditions. It is an expression of confidence in OOCEP’s future outlook from leading international banks. Our ability to attract this funding is a testament to the hard work of our employees and our continued growth in the upstream sector.”
“Our investment in OOCEP has matured to the point where the company can finance itself and directly contribute to OOC’s expansion plans in support of the continued growth and diversification of Oman’s economy,” Eng. Isam Al Zadjali added.
The facility attracted some of the leading names in international banking. Natixis and Societe Generale Corporate & Investment Banking acted as initial mandated lead arrangers, bookrunners and coordinators, joined by HSBC Bank Oman S.A.O.G. as initial mandated lead arranger and coordinator. Crédit Agricole Corporate & Investment Bank, Credit Suisse AG, ING, Intesa Sanpaolo and Sumitomo Mitsui Banking Corporation joined the deal as initial mandated lead arrangers, while ABN AMRO Bank N.V., Mitsubishi UFJ Finance Group and Mizuho Bank acted as mandated lead arrangers.
Commenting on the successful closing of the new loan facility, Eng. Ayad Al Balushi, Director of Finance at OOCEP stated “We’re very proud of the overwhelming interest shown by the financial community, and give thanks to all those involved in the arranging and closing of the new facility. This is a very significant milestone for our company.”
The asset base of OOCEP continues to generate sustainable growth, while developing new reserves and optimising hydrocarbon recovery. The billion dollar loan facility will be used to repay a shareholder loan and fund OOCEP’s activities and investment program.
OOCEP is the wholly owned subsidiary of Oman Oil Company, itself 100% owned by the Government of the Sultanate of Oman. OOCEP’s investments reflect Oman Oil’s strategy of pursuing local and international energy-related investments, as part of a broader initiative of the Sultanate to diversify its economy and promote Omani and foreign private sector investment. OOCEP has been named the fastest growing oil and gas company in the Middle East in 2016 by Wood Mackenzie.