LAWFUEL – Energy Law Business – Allen & Overy advised the sponsors, Saudi International Petrochemical Company (‘Sipchem’) and Japan Arabia Methanol Company Limited, on the Islamic refinancing of the USD142,702,703 International Methanol Company (‘IMC’) project in Al-Jubail Industrial City , Saudi Arabia.
The project is an integrated 970,000 metric tonne per annum methanol project which was originally financed in May 2003 and which achieved commercial operation in 2005.
The IMC project is an example of the growing trend in the Middle East market towards structuring transactions as Islamic Ijara lease structures. While the original 2003 financing for the project was done on a conventional basis, the current refinancing required a ‘conversion’ of the original transaction to an Islamic Ijara structure, which was particularly important to Sipchem given the recent public offering of its shares and the preference of many of its investors for Shariah-compliant transactions.
Allen & Overy partner Ian Ingram-Johnson commented, “Allen & Overy has been at the forefront of the development of a local market which is seeing an increasing preference for Islamically-compliant transaction structures. We were pleased to be able to assist Sipchem go some way towards achieving its long-term objective of ensuring all of its transactions are Islamically compliant”.
The Allen & Overy Dubai-based team was led by banking partner Ian Ingram-Johnson, assisted by senior associates Tarek El-Assra, Sachin Karia, Amanda Rologas, Kathryn Hartas and Neil Perrin.
For further information, please contact Ian Ingram-Johnson (ian.ingram-johnson@allenovery.com) on +971 (0)4 303 5623 or Melanie Carruthers (melanie.carruthers@allenovery.com) on +971 (0)4 303 5639 in Dubai.
