Gasol Secures USD 1 Mln Loan from SOCAR for Benin LNG Project
Gasol said that it has entered into an unsecured convertible loan agreement with Socar Trading S.A. (STSA).
STSA is the international marketing and development arm of SOCAR, the State Oil Company of Azerbaijan.
The loan reinforces STSA’s commitments to supply Liquefied Natural Gas (LNG) and assist Gasol with the provision of floating gas storage and regasification facilities for its proposed LNG Import project in Cotonou, Benin. These commitments are detailed in a Letter of Undertaking which the parties have also signed.
- STSA has agreed to lend Gasol US$1 million in the form of an unsecured sterling convertible loan note with a term of 2 years at an annual interest rate of 4 per cent. Gasol has drawn down the loan in full following signing and will use the proceeds for working capital purposes.
- Under the terms of the Convertible Loan Agreement:
- Interest is payable upon conversion or repayment of the facility;
- STSA has a conversion option, exercisable between the first anniversary and seven days before the repayment date, whereby STSA has the right to call for the conversion of all or part of the loan into ordinary shares of Gasol at a price that is the lower of 18 pence and the 90 day Volume Weighted Average Price of Gasol shares on the day of conversion; and
- Gasol may prepay the facility at any time prior to a Conversion Notice.
- STSA will assist Gasol with the provision of floating gas storage and regasification facilities.
The loan follows the signing of a Strategic Alliance between the two companies in December 2012 in relation to Gasol’s proposed LNG Import Project in Benin.
Further to the terms of the Strategic Alliance, the parties have now signed a Letter of Undertaking, detailing the terms and conditions upon which STSA will supply all LNG required for the Project and assist Gasol with the provision of floating gas storage and regasification facilities in the harbour at Cotonou, Benin. The Project involves the regasification of LNG and the supply of that gas to power and industrial customers in Benin, Togo and Ghana.
Alan Buxton, Chief Operating Officer at Gasol, commented: “SOCAR’s agreement to provide this loan facility to Gasol is highly positive news and reflects their confidence in our business model. We look forward to close interaction with SOCAR going forward.”
LNG World News Staff, March 18, 2013; Image: Gasol