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Eleme Petrochemicals secures IFC’s $375m facility

By on February 21, 2013

THE International Finance Corporation (IFC)-a member of the World Bank Group, has approved a $375 million (N59 billion) facility for infrastructure upgrade of Eleme Petrochemical Company’s operations in Rivers State.

Already, IFC has signed a loan for $150 million, and mobilised another $75 million through a syndicated loan with the Bank of India for the Nigerian company, which is the country’s largest fertilizer production outfit.

The IFC financing also mobilised an additional $150 million in parallel loans from other development finance institutions, such as the Belgian Investment Company for Developing Countries, the Commonwealth Development Corporation of the UK, Germany’s DEG, and FMO of the Netherlands.

The total project cost is $1.2 billion, of which $800 million will be financed by lenders. The total IFC financing package to Eleme amounts to $375 million.

This new project involves the construction and operation of a nitrogenous fertilizer plant at the site of Eleme’s existing petrochemicals complex in Port Harcourt, Nigeria. On completion, the facility will produce granulated urea that will be sold domestically and abroad. The project will involve the development of an 84-kilometer pipeline from the gas supplier’s facilities.

The investment is expected to improve farm yields and agricultural productivity, which are critical to Nigeria’s long-term food security. The investment also supports South-South investment into Africa, with Eleme’s parent company, Indorama, a long-time IFC client based in Indonesia.

Chief Executive Officer of Eleme Petrochemical, Manish Mundra, said: “IFC’s support for this project has helped to provide direct financing and mobilise significantly more to commence our fertilizer operations. With a growing population and limited available arable land, fertilizers are increasingly important to improving crop yield and food supply in Nigeria.”

IFC Senior Manager for Manufacturing, Agribusiness, and Services, Carsten Mueller, said the corporation’s investment in Indorama’s Eleme Fertilizer would help Nigeria expand its manufacturing base while improving food security.

“Indorama has a proven execution capacity for large-scale manufacturing operations and with our long relationship and shared commitment to Nigeria’s development, we welcome this new partnership to support further expansion in Africa.”