Ecobank Capital, the investment banking arm of Ecobank Group, a leading pan-African bank, announced that it has successfully raised, on behalf of Orion Oil Ltd (“Orion”), the sum of $ 500 million to be utilised for the prepayment of crude oil cargos to be supplied by Société Nationale des Pétroles du Congo (The National Oil Company of the Republic of Congo, “SNPC”).
The facility comprises a US dollar denominated USD 342 million tranche and a XAF denominated USD 158 million tranche. Ecobank Capital acted as the Mandated Lead Arranger, working with United Bank for Africa (“UBA”) Plc as co-arranging bank. Participating lenders were Afreximbank, BGFIBank Group, UBA Group, Banque Atlantique Group and the Ecobank Group.
Orion is a privately held company whose principal activities include the physical trading of crude oil and refined products. The company focuses on the value chain of the oil & gas industry, supplying approximately 100,000 metric tons of refined products each month along the West African Coast and holding interests in oil & gas fields in Congo. Orion entered into a 24-month crude oil allocation program with SNPC, the largest oil & Gas Company in Central Africa. The proceeds of the debt facility will be used to fund the prepayment of the aforementioned crude oil cargos (amounting to circa USD 100 million per cargo) on a Free on Board basis.
This transaction is the largest loan syndication completed to date in Central Africa solely funded by regional African banks and for an indigenous company. It clearly showcases the increasing interest of regional banks in financing capital intensive oil & gas deals in Sub-Saharan Africa, channeled through the diligent syndication expertise of Ecobank Capital.
Ikenna Onyejiaka, Acting Managing Director of Ecobank Capital said: “This landmark transaction underscores Ecobank Capital’s capabilities as a Lead Arranger of syndicated loans, working with Africa’s key financial institutions to provide vital support to Congo’s economic growth, especially at a time when the Euro zone crisis is threatening African businesses’ access to international markets.”
Foluke Aboderin, Executive Director of Ecobank Nigeria added: “Ecobank is proud to be associated with Orion Oil Limited, truly International Oil Company with a reputable track record. We are indeed excited to have participated in the USD 500 Million Pre-Export Financing with SNPC, Congo. For us at Ecobank, this transaction is undeniably strategic and represents what we are about – leveraging on our large footprint across middle Africa to support viable business for the development of our continent. Our expectations are that we would continue this strategic alliance/partnership with Orion in a manner that is mutually beneficial to both institutions.”
Georges Wega, Managing Director of UBA Cameroon, said: “UBA Group’s strong participation in this landmark deal underscores our passion to support African businesses and develop the economies of the continent. We look forward to doing more with more African businesses.”
Jean-Louis Ekra, President of Afreximbank, observed: “Afreximbank is delighted to be part of this transaction which not only supports Orion Oil Ltd in consolidating its position as a leading indigenous player in the oil sector but significantly boosts the capacity of the Republic of Congo to meet the development needs of its citizens. The transaction is a reflection of Afreximbank’s commitment to promoting trade and supporting local