BlackRock gets US$10 billion financing for Aramco deal: sources
The majority of the financing is a seven-year loan facility, which could later be refinanced in the bond market
[RIYADH] A group led by BlackRock’s Global Infrastructure Partners (GIP) unit has arranged a roughly US$10 billion financing package for its planned investment in Saudi Aramco natural gas infrastructure, people familiar with the matter said.
The majority of the financing is a seven-year loan facility, which could later be refinanced in the bond market, the people said. It also includes a 19-year loan facility, according to the people, who asked not to be identified because the information is private.
A group of banks including major Japanese and Wall Street lenders arranged the funding, the people said. The loans are set to support the GIP consortium’s investment in the midstream infrastructure assets at Aramco’s giant Jafurah gas project, the people said.
Last month, GIP signed a US$11 billion deal to lease the infrastructure serving the Jafurah gas project and then lease it back to Aramco for 20 years. Aramco is developing the over US$100 billion Jafurah project to supply fuel to domestic power plants as well as for export.
A newly-formed subsidiary, Jafurah Midstream Gas, will be created as part of the deal. Aramco will hold a 51 per cent majority stake in the venture, and the GIP-led group will own the rest.
A representative for BlackRock declined to comment, while Aramco did not immediately respond to a request for comment.
GIP joins a growing list of large institutions raising financing to back energy deals. Abu Dhabi National Oil is considering lining up more than US$10 billion in debt financing from local and international banks as it moves forward with its roughly US$19 billion pursuit of Australian fossil fuel producer Santos, Bloomberg News reported last week. BLOOMBERG
