London, January 10, 2005 — LAWFUEL – The Law News Network – White & Case advised Sohar Aluminium Company LLC, sponsored by Oman Oil Company S.A.O.C., the Abu Dhabi Water & Electricity Authority and Alcan, in connection with the development and financing of the construction of a $2.409 billion aluminium smelter complex in Sohar in Oman. When completed in mid-2008, the Sohar smelter (the first greenfield smelter in the Middle East in the last 25 years) will be able to produce 350,000 tonnes of aluminium ingots per year.
The construction of the smelter is an important step for the country’s economy as it seeks to diversify its economic base, building on the foundation of its hydrocarbon resources. Projects such as the Sohar smelter will enable Oman to capitalise on its oil and gas reserves to further raise national income and create significant employment.
The smelter complex at Sohar will consist of the smelter, casting facilities, raw materials handling facilities, unloading and loading facilities at the port of Sohar, storage facilities in the Sohar Industrial Area, and a 1000 MW electricity generation plant (the largest greenfield plant in Oman to date) to power the smelter.
The debt financing that is part-funding the project (provided by 17 financial institutions) was signed on 11 December 2005. Significantly, the debt financing includes a $260 million Islamic facility, the first project finance Islamic facility in Oman.
Craig Nethercott, White & Case partner advising the sponsors of the project commented, “Following on from large oil and gas projects, Middle Eastern countries are now seeking to diversify their economies by capitalising on their natural resource reserves to develop high value downstream industries, such as the Sohar aluminium smelter.”
The White & Case team was led by partners Craig Nethercott and Glen Ireland, co-head of White & Case’s Mining and Metals team, with the close assistance of senior associate Nick Collins, and associates Evgenia Laurson, Tina Wu, Scott Chalmers and Harj Rai. Partner Ellis Baker, head of White & Case’s London Construction Group, advised with respect to the construction contracts for the project.
The transaction is the fourth smelter financing that White & Case’s Mining & Metals team has advised on in recent years, having previously closed deals in Mozambique and Russia.