ACCRA (Reuters) - HSBC (HSBA.L) and Standard Chartered (STAN.L) issued a $500 million letter of credit to Ghana on Tuesday to guarantee the national oil company’s payments for gas extracted from the offshore Sankofa field.
The companies said in a statement the deal with Ghana National Petroleum Corporation (GNPC) should provide security over gas expected to flow in 2018 from the $7.9 billion (£6.2 billion) offshore oil and gas field being developed by Italy’s ENI (ENI.MI).
“The facility will guarantee GNPC’s payment obligations to energy companies Vitol and ENI related to the sale of gas to be extracted from the Sankofa field ... and piped onshore for both power generation and industrial and domestic consumption,” the statement said.
The World Bank also signed a $500 million deal with GNPC last month in the form of a partial risk guarantee for use if the country defaults on payments for Sankofa gas.
ENI holds a 44.4 percent stake in Sankofa, upstream trader Vitol [VITOLV.UL] holds 35.6 percent while GNPC holds a combined carried and participating interest of 20 percent. The World Bank will loan $200 million to the Sankofa partners.
HSBC France acted as agent on the deal and co-issued $250 million with Standard Chartered. The deal’s tenor is up to 17 years, the statement said.
Writing by Matthew Mpoke Bigg; editing by David Evans