March 12, 2010 / 10:08 AM / 9 years ago

RLPC-Nord Stream project financing signing - sources

LONDON, March 12 (Reuters) - The Nord Stream gas pipeline group and banks are in the process of signing documentation for a 3.9 billion euro ($5.3 billion) financing, sources close to the deal said.

Signing on a deal to back Nord Stream, which will pipe Siberian gas to Europe under the Baltic Sea, will complete on Tuesday, one of the sources said.

As previously reported, the total financing will be provided by 27 banks. It includes a 3.1 billion euros, 16-year facility covered by export credit agencies Hermes and Sace, as well as by the Federal Republic of Germany under its Untied Loan Guarantee Programme called “UFK” which covers political and commercial risk similar to Hermes. [ID:nL2500093]

The covered loan is split between a 1.6 billion euros Hermes loan, a 1 billion euros UFK loan and a 500 million euros Sace facility.

There is also an 800 million euros, 10-year uncovered commercial loan.

The commercial loan pays a margin of 275 basis points (bps) over EURIBOR pre-completion, 430 bps until year seven and 450 bps thereafter, banking sources told TRLPC in November. The commitment fee is 110 bps. [ID:GEE5AM2BP]

The Hermes loan pays a margin of 160 bps, the UFK loan pays 180 bps and the Sace loan pays 165 bps. The commitment fees are 65 bps, 75 bps and 65 bps, respectively.

Credit Agricole CIB is documentation bank and bank facility agent. SG is intercreditor agent, Sace facility agent, security trustee and model bank. Commerzbank is Hermes facility agent, UniCredit Bank (HVB) is UFK facility agent, Deutsche Bank is account bank and SMBC is technical/environmental bank.

The debt covers 70 percent of the project cost, while the shareholders will provide the remaining 30 percent, the Nord Stream consortium said on its website.

The Nord Stream consortium, which involves Russian gas export giant Gazprom (GAZP.MM), Germany’s E.ON (EONGn.D) and Dutch Gasunie, aims to have the twin pipeline up and running in 2011 and 2012, bringing 55 billion cubic metres of Russian gas to Germany and further to other European Union countries each year. (Reporting by Christopher Mangham; Editing by Dan Lalor and David Holmes) ($1 = 0.7369 euro)

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