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Aramco pipeline investors to refinance loan with bonds next year

EIG Global Energy Partners will lead a yet-unnamed consortium to issue billions of dollars in bonds across two or three transactions to replace bank debt backing an investment in Saudi Aramco’s oil pipeline assets, two sources said.

The Washington, D.C.-based firm’s consortium will issue bonds to replace $10.5 billion in so-called staple financing that was arranged by Aramco for potential suitors to take the 49 per cent stake, the sources said.

The $12.4 billion deal, announced last Friday, gives the EIG-led group a stake in Aramco Oil Pipelines, which has the rights to 25 years of tariff payments for oil transported through Aramco’s oil pipeline network that traverses the world’s largest crude exporter.

The staple financing backing the deal had a five-year maturity and one-year extension option, the sources said.

EIG will replace the full amount with long-tenor bonds across two or three bond deals, they said.

The first bond issuance will likely be in the first quarter of next year and the entire refinancing will be done within two years, the sources said.

The equity portion of the $12.4 billion deal was $1.9 billion and the rest was the staple financing, one of the sources said.

EIG is in talks to sell part of the equity portion to investors including Abu Dhabi state fund Mubadala, Chinese investors, pension funds in Saudi Arabia and the UAE, as well as a small piece to U.S. pension funds, the source added.

Mubadala has said it is looking at the deal.

EIG is a Washington, D.C.-based investment firm that has invested more than $34 billion in energy and energy infrastructure projects around the world.

EIG has not commented beyond its statement last week that said the transaction is expected to close soon, subject to customary closing conditions, including any required merger control and related regulatory approvals.

Aramco declined to comment.

HSBC was EIG’s financial adviser and Latham & Watkins was legal adviser, the statement said.

EIG has invested in a gas pipeline project with LNG producer Cheniere Energy, in oil and gas producer Aethon Energy and last year took a majority stake in Limetree Bay Ventures, an oil refinery and terminal in the Caribbean.

The Aramco pipeline deal closely mirrors infrastructure deals signed over the last two years by Abu Dhabi National Oil Co (ADNOC), which raised billions of dollars through sale-and- leaseback deals of its oil and gas pipeline assets.

A consortium that took a stake in ADNOC’s gas pipelines similarly refinanced bank debt with bonds across two transactions in October and February.

Source:https://energy.economictimes.indiatimes.com/news/oil-and-gas/aramco-pipeline-investors-to-refinance-loan-with-bonds-next-year-sources/82087535

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Kuwait’s Kipic picks Honeywell as automation contractor for Prize

Scion Industrial Engineering

Kuwait Integrated Petroleum Industries Company (Kipic), the company behind Kuwait’s $27bn (KWD8.2bn) Al Zour refinery has picked Honeywell Process Solutions (HPS) as the main automation contractor for its new Petrochemicals and Refinery Integration Al Zour Project (Prize).

As part of the contract, HPS will deliver front-end engineering design (Feed) and advanced process control technology for the complex, which will help Kipic reach its production targets faster.

In a statement, Honeywell said that Prize has been developed ad part of the Al Zour refinery complex and once developed will be the first integrated refining and petrochemicals complex in Kuwait. Upon being operational, the facility will increase Kuwait’s domestic petrochemicals, aromatics, and gasoline manufacturing capabilities.

Speaking on the contract win, president for Honeywell in Kuwait, Rachad Abdallah said: “At the integrated refining and petrochemicals complex at Al-Zour, we are leveraging our experience and technologies to help develop one of the most ambitious initiatives in the region.”

Meanwhile, acting chief executive officer at Kipic, Hatem Al Awadhi said: “With Honeywell’s support, we are building a strategic project that will only transform Kuwait’s domestic oil and gas market, and also provide a significant accelerator for the country’s long-term economic development by improving gasoline and benzene supply to the local and international markets.”

In July 2019, Honeywell UOP was awarded a contract by Kipic, as part of which the company would reconfigure the refinery and petrochemicals sections of Al Zour Refinery.

Source:https://www.constructionweekonline.com/products-and-services/260525-kuwaits-kipic-picks-honeywell-as-automation-contractor-for-prize

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Fluor, Daewoo, Hyundai JV start up boilers at KIPIC’s Al Zour Refinery

The joint venture of New York Stock Exchange-listed global engineering, procurement, fabrication, construction and maintenance firm Flour with Daewoo Engineering & Construction (E&C), and Hyundai Heavy Industries (FDH JV) has successfully started up two boilers that began generating steam in the new Al-Zour Refinery.

The refinery is a part of the Kuwait Integrated Petrochemicals Industrial Company’s (KIPIC) Package 2 and 3 project in the country.

In a stock market filing Fluor said that it is leading the JV that is working to deliver two engineering, procurement, fabrication, and construction packages for key process support units, utilities, and infrastructure for the highly complex, mega-sized Al-Zour Refinery project.

Upon completion, the grassroots complex is expected to be one of the largest refineries in the world, with the capacity to process 615,000 barrels of oil per day (bpod).

Commenting on the achievement, president of Fluor’s global energy and chemicals business, Mark Fields, said: “This significant milestone marks the completion of several critical utility systems to start up and advance the refinery into commercial operations with our ongoing support.

“Timely delivery of the new Al-Zour Refinery is critical to the Kuwait economy.”

Fields continued: “Our team worked closely with KIPIC to continue with about 15,000 workers on site to maintain progress throughout the COVID-19 pandemic.”

He added that the accomplishment was made possible through the FDH JV team’s “well-conceived health and safety strategy that was implemented with rigorous discipline”.

According to Fluor, several enabling facilities were completed and handed over, leading up to the achievement. This included the delivery of the central control room building and other associated buildings, fire water systems, communication system, and other refinery infrastructure.

COOEC Fluor Heavy Industries Co — Fluor’s joint venture fabrication yard in Zhuhai, China —delivered 188 modules with a combined weight of 65,000 metric tonnes to support the project’s large-scale, onshore modular execution strategy.

Speaking about the milestone, deputy CEO of KIPIC, Khaled Al-Awadhi, said: “Working together with the Fluor-led joint venture to achieve this important milestone for the ZOR Program is a true success – not only for KIPIC, but for the State of Kuwait – and will help bring energy self-sufficiency and further prosperity for all of us.”

In terms of health and safety achievement, the FDH JV has marked more than 154 million work hours on site. At peak, it employed more than 20,000 craft workers backed by joint venture team members spread across three continents.

Source:https://www.constructionweekonline.com/projects-and-tenders/267286-fluor-daewoo-hyundai-jv-start-up-boilers-at-kipics-al-zour-refinery

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KUWAIT MANUFACTURING INDUSTRY SECTOR – GROWTH, TRENDS, COVID-19 IMPACT, AND FORECASTS (2021 – 2026)

Small scale manufacturing plants in Kuwait produce petrochemicals, fertilizers, ammonia etc. The growth of the manufacturing sector in Kuwait has not been ideal, as it was hard hit firstly, by the Iraqi invasion and then, the recession. The contribution of the manufacturing sector towards the GDP of Kuwait has ranged between 5-6% for the past few years, though it is projected to reach USD XX billion by 2021 at a CAGR of XX%. Greater exposure to trade, competition in the sector and diversification are factors affecting the growth of this market.

Diversification Driving Manufacturing Sector Growth

Numerous initiatives are being taken by the government to promote the manufacturing sector, like the passing of the Kuwait Development Plan. It was approved for almost USD 120 billion and is expected to simulate Kuwait’s economy and help in developing the infrastructure. The government recently announced that it is increasing the budget for the manufacturing sector by nearly USD 1.7 billion per year.

New free trade zones are being built in Kuwait. This will increase the need for building products giving an automatic push to the construction material manufacturing industries. Availability of low-cost labor acts as an add-on to the success of the manufacturing sector.

Challenges

Land prices in Kuwait are elevated for industrial areas due to very high demand and low availability of resources. The news of more than 20 Kuwaiti factories deciding to relocate to Saudi Arabia because of the features and facilities it offers was also a major setback. Expensive electricity and energy, industrial production costs, unskilled labor, small market size and unavailability of resources are some of the major challenges faced by the manufacturing sector in Kuwait.

Opportunities

There are numerous opportunities in the construction material manufacturing industries in Kuwait. Apart from that foreign investors are being given a number of incentives which include a 10-year tax holiday and after that, a flat 15% tax for investing in Kuwait. Petrochemical is the biggest industry after oil and gas and offers great opportunities.

Key Deliverables in the Study

PESTLE Analysis (Overview): Macro market factors pertinent to this region.
Market Definition: Main as well as associated/ancillary components constituting the market.
Key Findings of the Study: Top headlines about market trends & numbers.
Market Dynamics:
Drivers: Key factors driving the growth of the market.
Restraints: Most relevant threats and restraints which hinder the growth of the market.
Opportunities: Sectors of high return or quick turnaround on investment.
Market Concentration: Porter’s Five Forces Analysis quantified by a comprehensive list of parameters.
Chain Analysis
Competition:
Market Share Analysis: Top players in the market (by value and volume).
Company Profiles: Pertinent details about leading, high growth, and innovation-motivated stakeholders with contact, operations, product/service offerings, financials, and strategies & insights.

Source:https://www.mordorintelligence.com/industry-reports/manufacturing-industry-in-kuwait-industry

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Jordanian shares slip, bucking gains in Mideast peers

Stocks in Jordan snapped a three-day advance, bucking gains in most Middle East markets, after several arrests were made following what may have been an attempt to destabilize the current government.

The Amman Stock Exchange General Index fell as much as 0.6 percent Sunday, reversing an increase of 0.5 percent last week. Jordan Petroleum Refinery Co. and Jordan Phosphate Mines fell more than 1 percent, dragging the index down the most.

Over the weekend, Hasan Bin Zeid, a member of the Jordanian royal family, was held on security grounds along with several others, including a former minister. Saudi Arabia, the United Arab Emirates, Qatar, Egypt and other Arab states expressed support for King Abdullah II.

Elsewhere in the region, benchmarks rose in Saudi Arabia, Dubai, Abu Dhabi, Bahrain and Kuwait as weighed in prospects of higher oil production in the near term. Last week, OPEC+ showed growing confidence in the global economic recovery by agreeing to increase oil production gradually in the coming months.

Saudi Arabia and its allies showed they are more convinced now that fuel demand is on a firmer footing after a yearlong beating from the coronavirus.

Investors should see “a very solid first quarter for Saudi petrochemicals,” said Jaap Meijer, the head of equity research at Arqaam Capital, in an interview to Bloomberg Television.

SOurce:https://www.arabianbusiness.com/trading/461378-jordanian-shares-slip-bucking-gains-in-mideast-peers

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Dubai-based Kitopi set to enter Bahrain, Qatar markets this quarter

Scion Industrial engineering Pvt. Ltd.

Kitopi, the Dubai-based cloud kitchen platform, is set to enter Bahrain and Qatar this quarter as part of its planned expansions into the wider GCC market.

The company is also gearing up to enter the Southeast Asian market between July and September.

The food tech start-up, which is reportedly planning another round of fundraising, however, has ruled out opening up for an initial public offering (IPO).

“We are looking to expand to Bahrain and Qatar in the next few weeks in Q2, and will be expanding in Southeast Asia in Q3,” a senior executive at the venture told Arabian Business.

“As for the fundraising plans, we’re not looking at an IPO at this point in time,” the director level executive said.

There have been talks among investment banking circles in Dubai about Kitopi being among some of the growth stage ventures in the UAE which are considering IPOs for their next round of fundraising.

Kitopi is currently present in the UAE, Saudi Arabia and Kuwait markets, operating more than 60 satellite kitchens with more than 1,200 partner restaurants.

Leading cloud kitchen and virtual restaurant operators in the UAE such as Kitopi and India-based Rebel Foods have been working on aggressive expansion plans in the GCC region on the back of exponential growth of online food delivery services in the region.

“Players such as Kitopi are expanding the food service category itself by capturing more ‘share of stomach’. These platforms have also enabled many restaurant chains and culinary start-ups to be closer to the customers and thus generate new demand and impulse purchases,” Sandeep Ganediwalla, managing partner of RedSeer Consulting, Dubai, a global consultancy firm specialising in online services, told Arabian Business.

“Although the lockdowns have fuelled the growth of this sector, our research indicates that there are other benefits such as variety, comfort and pricing that will continue to drive the sector post-pandemic,” Ganediwalla added.

Cloud kitchens have lately garnered attention from global investors and international food brands, as consumers have been forced to turn to online for food delivery due to the pandemic-induced lockdowns and movement restrictions.

On their part, food tech platforms have also been upping their game by planning global attention seeking moves as Rebel Foods’ plans to enter into a partnership deal with Expo 2020 Dubai, slated to commence in October, and Kitopi’s move to diversify into e-grocery business by launching ‘Shop Kitopi’ in Dubai last March.

“The business models of dark kitchens are still evolving, with players such as Kitopi offering multiple models from ‘end-to-end services’ to ‘no-frills kitchen operations’ and everything in between. However, competition in this space is increasing with many independent kitchen operators entering the space.

“If they are able to offer a distinctive value proposition and make the unit economics work, they would further boost the nascent dark kitchen ecosystem,” Ganediwalla said.

Kitopi raised $60 million last year – taking total investments in the venture to $120 million since it was founded in 2018.

As for the company’s decision not to consider an IPO for now, Ganediwalla said a growth-stage venture’s operations and business model would need to reach a certain level of maturity before they take the company public.

“An IPO is a big step in the journey of any company, as it would also mean controls and scrutiny increasing many-fold. [An IPO] could also become an interesting proposition as these start-ups mature and they get comfortable that public investors are valuing them fairly,” Ganediwalla said.

Source:https://www.arabianbusiness.com/retail/461549-kitopi-set-to-enter-bahrain-qatar-markets-this-quarter

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Egypt, Jordan, Iraq to implement commercial, industrial integration

The trade and industry ministers of Egypt, Jordan and Iraq have agreed to start actual steps of implementing commercial and industrial integration among the three Arab countries.

During the virtual meeting on Thursday, the three ministers agreed to send an Egyptian technical team to Iraq within the coming few days, with the participation of the Jordanian embassy in Baghdad, to assess Iraqi factories and find out the needs of the Iraqi market and the potential investment opportunities in the country, reports Xinhua news agency.

Egyptian Trade and Industry Minister Nevine Gamea said that the meeting came as a result of the visit of the Jordanian and Iraqi ministers to Egypt earlier this month, where they discussed implementation of a number of joint projects in the fields of trade and industry.

Gamea noted that the targeted sectors of joint cooperation include pharmaceutical, chemical, petrochemical, leather and ceramics industries, besides studying the establishment of a permanent exhibition for Egyptian and Jordanian products in the Iraqi capital.

For her part, Jordanian Minister of Industry, Trade and Supply Maha Ali emphasized the importance of electronic linkage between the customs authorities of the three countries to facilitate the process of trade exchange among them.

Meanwhile, Iraqi Minister of Industry and Minerals Manhal Aziz al-Khabbaz, expressed his country’s keenness to open up to the Egyptian and Jordanian markets and to start urgent steps towards achieving economic integration, “in light of the Iraqi government’s aspiration to restore its strong economic relations with all partners, especially at the regional and Arab levels”.

The Ministers also agreed on the necessity of lifting restrictions and obstacles that hinder the flow of intra-trade among the three countries, through granting easier access of their products to the three markets.

Source:https://www.business-standard.com/article/international/egypt-jordan-iraq-to-implement-commercial-industrial-integration-120122500147_1.html

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Saudi Arabia signs deal for rapid response to environmental threats in Red Sea

Scion Industrial ENgineering

Saudi Arabia has agreed a deal with Lamor Corporation for a project that will provide rapid response operations to combat oil spills and leaks of other harmful substances in the Red Sea.

Abdulrahman bin Abdulmohsen Al-Fadhli, the minister of environment, water and agriculture and chairman of the board of directors of the National Center for Environmental Compliance (NCEC), and Fred Larsen, board member of the Finnish environmental company, signed the contract. It will help to protect the marine environment off the shores of the Kingdom and build national capacities in this field.

“The project aims to implement response operations and combat oil spills and other harmful substances and accidents in the marine environment on the Red Sea strip, using ships and aircraft specialized in rapid-response operations,” according to a statement published by the Saudi Press Agency.
It will also enhance Saudi Arabia’s ability to respond rapidly to oil spills and other environmental dangers through the development of contingency plans, simulated response programs, and mechanisms for their implementation.
Under the contract, three platforms will be established to provide a quick response to oil spills and other threats to the Red Sea coast. In addition, training programs will be developed to enhance the capabilities of national teams of specialists in this field, and to facilitate the transfer of international expertise.

The NCEC works to promote and sustain the environment, and contribute to the prosperity of development sectors to improve the quality of life in the Kingdom. It works with other authorities to improve environmental compliance by monitoring pollution and providing environmental assessment, oversight and guidance. It also sets environmental standards and regulations, tracks and controls pollution levels and sources, and issues and renews environmental licenses and permits for businesses.

source:https://www.arabnews.com/node/1822916/saudi-arabia

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PIF’s Saudi Real Estate Refinance Company issues $1.07bn sukuk

British DIY retailer B&Q is coming to Saudi Arabia amid rising home ownership across the Kingdom.
The move follows a franchise deal between owner Kingfisher and the Dubai-based Al-Futtaim Group.
B&Q is expected to launch two 50,000-square-foot stores by fall to introduce the DIY franchise to Saudi customers, the company said in a statement.

The news helped to drive up the stock of Kingfisher by 4 percent in early London trading on Tuesday.
“This franchise agreement is a great opportunity to expand our business in the attractive Middle Eastern home improvement market with B&Q, one of our most established retail banners,” said Kingfisher CEO Thierry Garnier.
Home improvement has fared better than most of the retail sector amid the pandemic. Millions of people around the world have used increased time at home to renovate their properties, spurring sales across the DIY retail sector.
The expansion into Saudi Arabia represents a significant move for B&Q and comes amid the development of a local mortgage market in the Kingdom.

The first B&Q stores in Saudi Arabia will stock a full range of home improvement products. Brands on offer will include Kingfisher’s portfolio, including Erbauer, Magnusson and GoodHome, alongside locally and internationally sourced products

The Al-Futtaim Group operates more than 200 brands across the Middle East, Asia and Africa. It has operated the retail franchises in the Middle East for Marks & Spencer since 1998 and for IKEA since 1991.

Source:https://www.arabnews.com/node/1822886/business-economy

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Bahrain’s Investcorp said to raise $1bn for North American deals

Scion

Investcorp Holdings has raised about $1 billion for its first private equity fund focused on North American assets, according to people familiar the matter.

The biggest private equity and alternative asset manager in the Middle East is set to complete a first close on the fund soon, and aims to eventually raise about $2 billion, the people said.

The fund will focus on investing in areas including technology and data companies, along with supply chain and industrial services.

Among the fund’s backers are a Middle East sovereign wealth fund and large asset managers from the US and Europe, the people said, declining to be named because the information isn’t public.

Bahrain-based Investcorp, which oversees about $34 billion, is raising more funds for specific uses as it looks to boost assets under management. It’s previously tended to book deals on its own balance sheet and sell them on to investors.

Set up in 1982, the money manager is already the Gulf’s largest private investor in US real estate and has said it wants to boost its assets under management to $50 billion in the coming years. Abu Dhabi sovereign fund Mubadala in 2017 acquired a 20 percent stake in Investcorp, which has backed companies including Tiffany & Co and Gucci.

Source:https://www.arabianbusiness.com/banking-finance/459766-investcorp-is-said-to-raise-1-billion-for-north-american-deals