The Saudi-based Arab Petroleum Investments Corporation (APICORP) said on Monday it has issued Sharia-compliant financing facility for Oil Recovery Services SAL (ORSsal) operating in Algeria.
The facility is the first of its kind for APICORP in the Algerian market, and will finance part of the cost of equipment and working capital for a three-year contract which ORSsal won in March last year from state-owned Sonatrach.
The project has a total value of $47.6mn and includes the provision of drilling/completion fluids, waste management and engineering services.
The initial $10mn financing, provided by APICORP and overseen by Paris-based oil and gas private equity firm 4D Global Energy Advisors (4D GEA), will act as a template for the financing of several other contracts in the pipeline, the company said.
Dr Raed Al Rayes, Deputy CEO and General Manager of APICORP, commented: “Completing this facility for ORSsal is a timely step for APICORP, as it helps us strengthen our position in the Algerian lending market, which is consistent with APICORP’s objectives to develop the energy sector in the Arab world.
“The facility will also help APICORP take advantage of other attractive business opportunities available within the Algerian market for years to come.”
Last month, APICORP predicted total committed and planned energy investments in the MENA region, including Iran, to reach $900bn over the next five years.
According to a recent report, Algeria will invest $8bn on gas as it focuses on developing its midstream sector as part of the country’s plan to expand total pipeline-network capacity by 30%.
APICORP is a multilateral development bank established in 1975 by the 10 member states of the Organisation of Arab Petroleum Exporting Countries (OPEC).
