Clifford Chance and Al-Jadaan & Partners Law Firm have advised the financiers on Phase II of the financing of a US$10.8 billion integrated aluminium complex and related infrastructure, sponsored by Saudi Arabian Mining Company (Ma’aden) and Alcoa Inc. Phase II involved the financing of a bauxite mine to be developed at Al Ba’itha in Saudi Arabia and an associated alumina refinery, with the combined cost of development being US$3.58 billion. The bauxite mine will be the first such mine in Saudi Arabia and is set to extract up to 4,250,000 tonnes of bauxite ore per annum. The refinery will have an initial capacity of 1,800,000 tonnes of refined alumina per year. Both the mine and refinery are being developed by Ma’aden Bauxite and Alumina Company (MBAC). MBAC is a joint venture between Ma’aden and Alcoa Inc. Once complete, the entire project will be the largest fully integrated aluminium complex in the world, with a refinery, smelter and food-grade can sheet rolling mill located at the Ras Al Khair industrial site (previously known as Ras Az Zawr) in north-eastern Saudi Arabia, fed by bauxite sourced from the Al Ba’itha mine.
The total amount of the multi-sourced financing for the mine and refinery project will be US$2.15 billion and comprises an Islamic Ijara facility (including separate Riyal and US dollar tranches), an Islamic Wakala facility, commercial facility, a facility to be provided by the Public Investment Fund of Saudi Arabia and a facility to be provided by the Saudi Industrial Development Fund.
Clifford Chance acting through its offices in Frankfurt, Dubai and Abu Dhabi and Al-Jadaan & Partners Law Firm advised the financing group, comprising commercial banks/financial institutions led by a set of mandated lead arrangers which comprised Alinma Bank, Al-Rajhi Banking & Investment Corporation, Arab National Bank, Bank AlJazira, Banque Saudi Fransi, Emirates NBD, Export Development Canada, Riyad Bank, Samba Financial Group, Saudi Hollandi Bank, The National Commercial Bank, The Saudi British Bank and The Saudi Investment Bank. The National Commercial Bank and Banque Saudi Fransi acted as documentation banks.
The Clifford Chance team for Phase II was led by partner Edmund Boyo (Frankfurt) who was assisted by partners Qudeer Latif (Dubai), Sandy Hall (Abu Dhabi) and counsel Malcolm Turner. The core team comprised senior associates Matthew Meyerink (Frankfurt), Sandeep Puri (Dubai) and Robin Balmer (Dubai). The wider team included senior associates Craig Dale, Anna Thwaites, associates Michael Gibling and Isabel Cropley (all Frankfurt) and senior associate Tori Single (Abu Dhabi) – all Banking & Finance. The Al-Jadaan team for Phase II was led by partners Mohammed Al-Jadaan and Abdulaziz Al-Abduljabbar with support from partner Khalid Al-Abdulkareem, senior associate Ose Asemota and associate Fahad Abuhimed.
Documentary completion of Phase I occurred late last year. Pursuant to the Phase I financing, the sponsors are developing the US$5.01 billion aluminium smelter project and the US$2.52 billion aluminium rolling mill project through Ma’aden Aluminium Company and Ma’aden Rolling Company respectively. The aluminium smelter will be the first to be constructed in the Kingdom of Saudi Arabia, while the rolling mill will be the first food-grade can sheet rolling mill to be constructed in the GCC.
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