QP Concludes Financing Deal of Barzan

Doha , December 13 (QNA) - Qatar Petroleum (QP) announced Tuesday that it has completed the financing of the Barzan gas project which estimated cost is $10.4 billion. The project aims to satisfy local demand for natural gas. QP released a statement today announcing that the concluded deal is the biggest struck in 2011. It is also one of the biggest projects in history in the oil and gas field. The first production line is set to be completed by 2014, while the second one will be completed in 2015. HE Minister of Energy and Industry Dr. Mohammed bin Saleh Al Sada, who is also Chairman and Managing Director of QP, said that the project's financing deal was "unprecedented." He stressed that QP has managed to secure finances worth $8 billion, even though it planned for $6.6 billion. The deals were struck with a number of different international banks. HE Al Sada added that the competition between banks to contribute in Barzan shows the strength of Qatar's economy, the matter which reflects the wise leadership of HH the Emir Sheikh Hamad bin Khalifa Al Thani. HE the Minister of Energy and Industry Al Sada stressed that the project is of vital importance to the State of Qatar, and the concluded financing deals is a big step towards achieving it. The Minister of Energy and Industry said earlier that international banks finance 70% of the project, while the remaining 30% is financed by the partners in the project. QP has a 93% stake in Barzan, while Exxon Mobil has the remaining 7 % . For his part, Abdul-Rahman Al Shibi, who is the Director of Finance at QP, expressed delight that the banks and financial institutions provided the necessary finance to Barzan, particularly in light of the disruptions marring the global financial markets. He also stated that Qatar Islamic Banks participated in the financing. Their contribution to Barzan is the highest to a QP project in the company's history. Commercial banks financed $3.34 billion, while Islamic banks financed $850 million. Meanwhile Director of Project Financing in QP Mishal Mohmmed Al Mahmoud said that the finance put a lot of effort to secure the deals. The Royal Bank of Scotland was the financial advisor in the funding process, White and Case was the legal advisor to the project's owners and Allen & Overy was the advisor to credit agencies. Barzan is one of the main projects, in the field of energy, of Qatar National Vision's 2030. It aims to satisfy the local demand for gas. It will produce 1.4 billion cubic feet of gas a day. It will also produce 23,000 barrels of condensates and 1,900 tonnes of Ethane plus LPG. LPG will be produced through producing 860 tonnes a day of propane, and 680 tonnes a day of butane. (QNA)