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Russian oil products pipeline gets $75 million loan
Strong debut on international debt market for state-owned TransnefteproductThe EBRD and a consortium of international banks are making a $75 million, five-year loan to OAO AK Transnefteproduct (TNP), owner and operator of the Russian pipeline system for transporting oil products, to finance the modernisation of its network.
The transaction marks the state-owned firm’s debut in the international debt market - with the EBRD acting as the lender of record for the full amount and providing $30 million of its own funds. The remaining $45 million is being syndicated to three commercial banks under an EBRD A/B loan structure.
International banks showed strong interest in acquiring TNP debt. To meet demand, the size of the loan syndicated by the EBRD was almost doubled from its original target of $25 million. Raiffeisen Zentralbank Oesterreich AG (RZB) is planning to take $20 million while France’s Natexis Banques Populaires and Germany’s Commerzbank AG each plan to take $12.5 million.
TNP’s network of 15,200 km of pipelines in Russia is capable of handling 55 million tonnes of oil products a year and is mostly used to transport diesel, jet fuel and petrol. Two-thirds of the pipes have been in service for over 30 years.
With many Russian oil companies upgrading their refineries to increase the output of oil products, it is essential that the transportation system is ready to handle the extra strain and that ageing infrastructure is replaced in order to improve environment safety. The EBRD loan will be used to finance such capital expenditures.
The EBRD is glad to have helped TNP tap international debt markets for the first time and welcomes the company’s commitment to promote good corporate governance, said Peter Reiniger, Director of the Bank’s Energy Business Group..
Such measures as publishing TNP’s audited IAS accounts, basing procurement on international tendering and holding an independent environmental audit (partly paid for by the Canadian government) will all help make TNP more attractive to the commercial sector and send an important signal to other major state-owned companies in Russia, Mr. Reiniger added at a signing ceremony in Moscow.
Strong debut on international debt market for state-owned Transnefteproduct
The EBRD and a consortium of international banks are making a $75 million, five-year loan to OAO AK Transnefteproduct (TNP), owner and operator of the Russian pipeline system for transporting oil products, to finance the modernisation of its network.
The transaction marks the state-owned firm’s debut in the international debt market - with the EBRD acting as the lender of record for the full amount and providing $30 million of its own funds. The remaining $45 million is being syndicated to three commercial banks under an EBRD A/B loan structure.
International banks showed strong interest in acquiring TNP debt. To meet demand, the size of the loan syndicated by the EBRD was almost doubled from its original target of $25 million. Raiffeisen Zentralbank Oesterreich AG (RZB) is planning to take $20 million while France’s Natexis Banques Populaires and Germany’s Commerzbank AG each plan to take $12.5 million.
TNP’s network of 15,200 km of pipelines in Russia is capable of handling 55 million tonnes of oil products a year and is mostly used to transport diesel, jet fuel and petrol. Two-thirds of the pipes have been in service for over 30 years.
With many Russian oil companies upgrading their refineries to increase the output of oil products, it is essential that the transportation system is ready to handle the extra strain and that ageing infrastructure is replaced in order to improve environment safety. The EBRD loan will be used to finance such capital expenditures.
The EBRD is glad to have helped TNP tap international debt markets for the first time and welcomes the company’s commitment to promote good corporate governance, said Peter Reiniger, Director of the Bank’s Energy Business Group..
Such measures as publishing TNP’s audited IAS accounts, basing procurement on international tendering and holding an independent environmental audit (partly paid for by the Canadian government) will all help make TNP more attractive to the commercial sector and send an important signal to other major state-owned companies in Russia, Mr. Reiniger added at a signing ceremony in Moscow.
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