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Aramco’s oil pipeline investors to refund loans with bonds in 2022

Aramco’s oil pipeline investors to refund loans with bonds in 2022
The first bond issuance is expected to take place in Q1-22
SAUDI ARAMCO
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Riyadh – Mubasher: EIG Global Energy Partners will lead a consortium to issue billions of dollars in bonds over two or three transactions to refinance loans for investment in the Saudi Arabian Oil Company’s (Saudi Aramco) oil pipeline assets, Reuters reported on Thursday.

The first bond issuance is expected to take place during the first quarter (Q1) of 2022, while the entire refinancing is likely to be done over two years.

Earlier this week, Aramco signed an agreement worth $12.4 billion (SAR 46.5 billion) with an EIG-led consortium to sell 49% equity of Aramco Oil Pipelines Company.

EIG’s consortium “will issue bonds to replace $10.5 billion in so-called staple financing that was arranged by Aramco for potential suitors to take the 49% stake,” according to the news portal.

The staple funding had a five-year maturity and one-year renewal option.

The equity portion of the $12.4 billion deal was $1.9 billion while the rest was the staple financing.

Abu Dhabi-based sovereign wealth fund Mubadala, meanwhile, is in talks with EIG to join the consortium investing in Aramco’s oil pipelines.

Earlier this month, US-based asset manager BlackRock and Canada’s Brookfield Asset Management exited the race to buy equity in Aramco’s pipeline business.