Cost of Financing for ALBA: The Pot Line 5 Expansion Project

Contents
Base Case Strategy
Proposed Multisource Strategy

Assumptions
Libor (%)
CIRR (%)

1.65
4.9

COST OF FINANCING: ALBA Pot Line 5 Ex

Sr. No.

Sources

Amount
(US$ mil)

Tenor
(years)

Base
Lending
Rate

Spread
(bp)

Upfront
Guarantee
Fee (bp)

Base Case Financing Strat

Commercia
l bank
1 loans

350

10

LIBOR

110

0
0

ECA
guar./insur
2 ed loans

1200

8.5
12
8.5
12

CIRR

60

600
600
600
600

Total debt

$1,550

Upfront
(AVG)%

Net Cost
(%/yr)

Shareholde
rs' equity
(cash)
Project
total

150

$1,700

SUMMARY:

Amount ($ mil)
Commercial
bank loans
ECA
guar./insure
d loans

Avg Cost
%/yr

350

2.88

0.875

2.963

1200

5.63

6.875

6.316

Base Case Fina

Shareholder
s' equity
(cash)

150.00
1700.00

n/a

100.000
235.563

n/a
5.559

(US$ mill)

(WT Avg)

ALBA Pot Line 5 Expansion Project

Commitment
Fee (bp)

Rate

Arranging
Fee (bp)

One Time
(Total)
(bp)

Avg One
Time for
Tenure
(bp)

Net Rate
(%/yr)

se Financing Strategy
25

2.88

75
100

75
100

7.500
10.000

2.950
2.975
2.963 AVG

25

5.63

75
75
100
100

675
675
700
700

79.412
56.250
82.353
58.333

6.419
6.188
6.449
6.208
6.316 AVG
5.559

Base Case Finance Strategy

Shareholders' equity
(cash)
9%
Commercial bank
loans
20%

WT. AVG

ECA guar./insured
loans
71%

Proposed Financing Strateg

Sr. No.

Sources
Commercia
l bank
1 loans

Metalslink
2 ed facility

Islamic
3 lease

Amount

Tenor

Base

Spread

Upfront

(US$ mil)

(years)

Lending
Rate

(bp)

Guarantee
Fee (bp)

300

10
10

LIBOR

115

0
0

500

10
10

LIBOR

125

0
0

750

10
10

LIBOR

145

0
0

300

12
12

LIBOR

110

0
0

500

12
12

LIBOR

120

0
0

200

12
12

LIBOR

130

0
0

400

12
12

LIBOR

140

0
0

4 Local bond

200

10
10

LIBOR

100

0
0

ECA
guar./insur
5 ed loans

150

8.5
12
8.5
12

CIRR

60

600
600
600
600

Total debt

$1,550

Upfront
(AVG)%

Net Cost
(%/yr)

Shareholde
rs equity
(cash)
Project
total

150

$1,700

SUMMARY:
Avg
Cost
Amount ($ mil) %/yr
Commercial
bank loans
Metalslink
ed facility

300-750

3.06

0.875

3.190

300-500

2.93

0.875

3.010

0.875
0.875

3.215
2.863

Islamic lease
200-400
Local bond
200
ECA
guar./insure
d loans
150
Shareholders equity (cash)
150
1700.00

3.13
2.78

5.63
n/a

6.875
100
172.563
(US$ mill)

6.314
n/a

osed Financing Strategy

Commitment
Fee (bp)

Arranging
Rate

Fee (bp)

One Time
(Total)
(bp)

Avg One
Time for
Tenure
(bp)

Net Rate
(%/yr)

25

2.93

75
100

75
100

7.500
10.000

3.000
3.025
3.013 AVG

25

3.03

75
100

75
100

7.500
10.000

3.100
3.125
3.113 AVG

25

3.23

75
100

75
100

7.500
10.000

3.300
3.325
3.313 AVG
3.190 WT. AVG

3.06

25

2.88

75
100

75
100

6.250
8.333

2.938
2.958
2.948 AVG

25

2.98

75
100

75
100

6.250
8.333

3.038
3.058
3.048 AVG
3.010 WT. AVG

2.93

25

3.08

75
100

75
100

6.250
8.333

3.138
3.158
3.148 AVG

25

3.18

75
100

75
100

6.250
8.333

3.238
3.258
3.248 AVG
3.215 WT. AVG

3.13

25

2.78

75
100

75
100

7.500
10.000

2.850
2.875
2.863 AVG

25

5.63

75
100
75
100

675
700
675
700

79.412
58.333
79.412
58.333

6.419
6.208
6.419
6.208
6.314 AVG

Sources
Commercial
bank loans
ECA
guar./insure
d loans
Shareholder
s' equity
(cash)

Amount
(US$ mil) Rate
350

1200

150

Base Case Finance Strategy

Shareholders'
equity (cash)
9%
Commercial
bank loans
20%

ECA
guar./insured
loans
71%