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Egypt News
Thursday, March 4, 2010
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EGPC to cut down the value of the loan


EGPC to cut down the value of the loan

Banks alliances, which submitted offers to win the Egyptian General Petroleum Corporation’s bid for the $ 2 billion loan, said it will soon announce the winning coalition during this month, according to a source close to the banks.

Earlier, an official at EGPC hinted that the value of the loan could be decreased due to a shortage in the amount of Oil and Naphtha required to secure the credit of the loan.

“Looking at the given data of produced Naphtha and Mazut, it was found that it would only meet a credit facility of $ 1.5 billion at maximum and a $ 1.3 billion at minimum, and we wanted to secure a $ 2 billion loan,” said the EGPC Official.

He added the reason behind the drop in naphtha because of EGPC’s extended loan deal with Morgan Stanley bank, which made the corporation agree on exporting a limited quantities of crude oil and naphtha for 3 years starting from 2011 and ending in 2014, in exchange of a $ 900 million loan that was signed last year.

The Egyptian General Petroleum Corporation is currently working with the Technical Committee to settle on the final financial value of the loan that will be negotiated on with the banks consortium, and how to ensure converge to the loan with the needed quantities of oil and naphtha.

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