ING and RBS?agree debt deal for Singapore petrochemical project

ING and Royal Bank of Scotland have launched a much delayed £1bn debt restructuring deal to help fund construction of Singapore’s Jurong Aromatic Corporation’s (JAC) petrochemicals project.

The project is now expected to commence operations in 2014 with construction beginning next year. Talks over financing started last year but progress was delayed by poor market conditions.

Some $1.24bn (£796m) – or 80 per cent of the debt – will now be financed or guaranteed by two South Korean export agencies for a period of up to 15.5 years.

In a statement Bruce Macfarlane, head of the advisory team at joint coordinating bank ING, said yesterday: “The timing seems perfect now with almost no other deals of this size or quality expected in the market this year.”

The $2.4bn project involves the development of a condensate splitter and aromatics facility on offshore Jurong Island and will produce 1.5m metric tons of aromatics per year and 2.5m metric tons of transport fuels per year, the company said.

A JAC spokesman added: “We expect a very favourable reception from lenders given the long anticipation by the bank market of its launch, the favourable recovery of the financial markets and robust economics of the project.”

Banks invited to join the lending group are expected to pledge financial commitments of between $75m to $150m by next month. The loan is expected to be signed by early December.