Banque Du Caire has signed, last Thursday, a contract with the Egyptian Refining Company (ERC), a subsidiary of Citadel for Financial consultations, to provide letters of guarantee for both Egyptian General Petroleum Corporation and Citadel Capital; domestic investors with value of US$ 40 million (=EGP 240 million) out of US$ 300 million, the total value of letters of guarantee the Company plans to have from banks, sources told Amwal Al Ghad.
ERC asked the Bank not to offer these letters before May,21, after the Company can sign agreements with all banks that consider contributing in offering these letters, sources added.
Banque Misr, HSBC, Arab African International bank, Ahli United Bank and Mashreq Bank consider contributing in providing these letters, but their contributions are not decided yet. Banque Misr will sign the contract next week with contribution ranging from US$ 115 million to US$ 125 million, sources added.
Sources noted that these letters will used to meet the liabilities of ERC towards international organizations that contribute in the establishment of a developed oil refinery in Cairo. Given being shareholders in the company and providers of a loan with value of EGP 2.6 billion, financial institutions conditioned on Egyptian institutions offering letters of guarantee in case of increasing the investment cost in 4 years so as to cover the increase in the Company’s capital when needed.
The investment cost of the project is US$ 3.7 billion providing an annual design capacity 4 million tons of petroleum products; 2.3 million tons of diesel, 860 thousand tons of benzene and 80 thousand tons of butane. The Project will provide US$ 3.6 million annually to finance balance of payments deficit.
