China’s Sinopec and its German joint venture partner BASF have appointed financial institutions to help raise US$1.4 billion for the construction of an integrated petrochemical complex in Nanjing, China.
Their equally owned company BASF-YPC Company Limited will build and operate a US$2.9 billion complex comprising a 600,000 metric tons/year ethylene plant and nine downstream units on a 220-hectare site on the Yangze River.
The project-finance scheme will comprise an equal split of US dollar and Chinese renminbi (RMB) loans. The US$ tranche will include a component covered by an export credit agency (ECA) guarantee. The rest of the US$ funds and the RMB tranche will be uncovered.
Citibank and the Industrial and Commercial Bank of China have been appointed joint co-ordinating lead arrangers. Citibank is the lead arranger for the ECA-covered USD tranche while HypoVereinsbank is the co-lead arranger. The Agricultural Bank of China is lead arranger for the uncovered US$ tranche while co lead arrangers are the Bank of China, Bank of Communications, and Industrial and Commercial Bank of China.
The Industrial and Commercial Bank of China is lead arranger for the RMB tranche, while the co lead arrangers are the Agricultural Bank of China, Bank of China, Bank of Communications and China Construction Bank.
Citibank, the Bank of China, the China Construction Bank and the Industrial and Commercial Bank of China have been acting as financial advisors to the project’s sponsors since 1997.
BASF-YPC Company Ltd is the largest Sino-German joint venture in China. The complex, now under construction, is expected to begin commercial operations in 2005 and will produce about 1.7 million metric tons of high quality chemicals and polymers per year to serve the domestic market.