Emirates Aluminium signs export credit funding deal

Emirates Aluminium

Emirates Aluminium has signed financing agreements with three Export Credit Agencies to support the financing of the project. In doing so it has secured loan financing agreements for approximately $737 million for a term of up to 15 years.

Export-Import Bank of the United States, Euler Hermes Kreditversicherungs-AG (Hermes) and the Compagnie Française d'Assurance pour le Commerce Extérieur (COFACE) will provide financing support for the Taweelah-based smelter.

"These agreements speak to the strength of this project and the soundness of EMAL's long term business plan," said Saeed Al Mazrooei, President and Chief Executive Officer of EMAL. "We would not have been able to achieve this without the teamwork and support provided by our employees, shareholders - Mubadala and DUBAL - and, of course, the UAE government."

A direct loan agreement with US Ex-Im will provide the project with $317 million in funding; Hermes will provide cover for a $220 million bank-funded term loan facility; and COFACE will provide cover for a $200 million bank-funded term loan facility. Each facility has a door-to-door tenor of around 15 years and a repayment period of 14 years. This financing augments EMAL's existing term loan financing completed in 2007.

"These agreements mark the realisation of a significant portion of our project financing plan, with relatively low cost funding secured over a long tenure, which in today's market illustrates the strength of the EMAL project and the Sponsors as well as the projects importance to the industrialization strategy of the UAE" said Bill Campbell, EMAL's Chief Financial Officer.

EMAL is a joint venture (JV) between Dubai Aluminium Company Limited (DUBAL) and Mubadala Development Company (Mubadala) and was established in February 2007 to construct what will become the world's largest single site aluminium smelter complex. The project will be built in two phases and utilise DUBAL DX technology. Phase one started production in December 2009 and once finished EMAL will produce 750,000 tonnes of aluminium per annum and 1.5 million tonnes annually at the end of phase two. The aluminium complex, a 6sq km site in the Khalifa Port Industrial Zone in Al Taweelah, half way between Abu Dhabi and Dubai, will produce primary aluminium with a product mix of sow, standard ingot, tee ingot, extrusion billet and sheet ingot.

Being the largest industrial project in the UAE outside the oil and gas industry, the project will encourage economic diversification, creating downstream opportunities. This development will benefit the UAE economy, employing more than 17,000 local and international contractors/staff during construction and approximately 2,000 people direct employment during operations.

EMAL adheres to strict environmental standards set by the Abu Dhabi Environmental Agency, with state-of the-art emission control equipment including sulphur-dioxide scrubbers, the latest potroom gas treatment technology, the best-available gas turbine systems, and cooling towers to eliminate thermal stress on local marine life.

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