Azerbaijan, Baku, Sept. 14 / Trend E.Ismayilov /
On Oct.21, the European Bank for Reconstruction and Development (EBRD) fixed the date of approval of a $120 million loan for AZMECO to construct a methanol plant in Azerbaijan, AZMECO said on Sept.14.
"Although, previously the loan was scheduled for approval on Sept. 22, the Board of Directors will consider this matter in October," the source added.
EBRD approves up to USD 120 million financing with 2 separated tranches: a USD 90 million senior loan up to 9 years; a USD 30 million Senior Performance-Linked Financing fully re-paid in year 10.
The company continues the negotiations on drawing the additional funds needed for construction of the plant with the German, Austrian and Dutch banks, which had previously expressed a willingness to finance the construction of the plant.
"It is early to talk about something at this stage, because everything is under the negotiations," the source added.
The construction of the plant began in 2007 and AZMECO's own investment in this project is $70 million. The International Bank of Azerbaijan, EDC of Canada and the Black Sea Trade and Development Bank also finance this project, the source said.
The total cost of the project on construction of methanol plant is over $300 million.
The methanol plant which will be located in the Garadag region is expected to be put into operation in the third quarter of 2010. Work on construction of the plant was launched in 2007.
In the first phase, the production capacity of the methanol plant will be 720,000 tons per year. Completion of the second phase of construction, which involves the production of nitrogen fertilizer, is scheduled for 2011. In the second phase of the construction it is scheduled to produce about 400,000 tons of nitrogen fertilizer.
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