Mitsui & Co., Ltd. ("Mitsui") has announced the signing on 9 August 2010 of an agreement to provide a loan facility of US$200 million to Egyptian Refining Company (Takrir) S.A.E. ("ERC"), a special purpose company established by Citadel Capital, the leading private equity firm focusing exclusively on Africa and the Middle East region, and its co-investors, including Egyptian General Petroleum Corporation ("EGPC"). The loan is covered by Nippon Export and Investment Insurance (NEXI) under its Overseas Investment Insurance program.
ERC is developing a state-of-the-art greenfield second-stage oil refinery in Mostorod, 40km northeast of Cairo, Egypt which will produce over 4 million tons per year of light petroleum products including LPG and diesel, adjacent to existing facilities owned by Cairo Oil Refinery Company ("CORC"), a subsidiary of EGPC. Total project costs are approximately US$3.7 billion, to be funded by a combination of sponsor equity, the loan from Mitsui and financing from international commercial banks and from policy-driven international financial institutions including Japan Bank for International Cooperation, The Export-Import Bank of Korea (Korea Eximbank), European Investment Bank and African Development Bank.
A consortium of Mitsui and South Korea's GS Engineering & Construction Corp. was awarded the engineering, procurement and construction contract for the facility in 2007, expected to be commercial operation in July 2015, and has supported smooth start up of the Project.
Despite rapid and sustained economic growth in Egypt, investment in the industrial production of light petroleum products such as diesel has not kept pace with increased demand. Once the project enters commercial operation it is expected to significantly reduce reliance on importation of such products. Mitsui is proud and honored, through its involvement in the successful development and execution of this important project, to contribute to Egypt's self-sufficiency in the production of higher-value petroleum products, to improving the environment by reducing the quantities of sulphur released into the atmosphere in the Greater Cairo area, and to creating employment opportunities for skilled domestic workers.
Mitsui is committed to further investment in the basic industry sector, including in the refining industries, and will continue to prioritize proactive involvement in infrastructure projects in Egypt and the rest of the Middle East. Through its business activities Mitsui is dedicated to contributing to wider development in these geographic regions and to strengthening the mutual cooperation between these regions and Japan.
||Egyptian Refining Company (Takrir) S.A.E.
||Mostorod, Greater Cairo, Egypt
||4 July 2007
||Arab Refining Company: 82%
Egyptian General Petroleum Corporation: 15%
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