Apicorp launches US$500m corona support package for its member countries

GLOBAL – The Arab Petroleum Investments Corporation (Apicorp), a multilateral lender, has rolled out a US$500 million support package to help clients in the energy sector continue to fund projects as the Covid-19 outbreak and oil price fluctuations challenge the industry. 

The funds will be deployed to support sustainable, impact-driven utilities, renewables and petrochemicals projects, among others, Apicorp said in a statement. 

The Dammam-based lender will also expand its trade finance facilities to its member countries within the broader objective of reducing the fiscal and current account pressures caused by current market conditions. 

“The energy sector is a capital-intensive sector where we are observing investment reductions and delays in implementation more than previous downturns,” Dr Ahmed Ali Attiga, chief executive of Apicorp, said.  

“As a trusted financial partner, Apicorp will play a countercyclical role to address the funding shortfalls that may occur to our partners in the region as they work to meet planned commitments in critical projects and operations.” 

Apicorp is owned by the 10 members of the Organisation of Arab Petroleum Exporting Countries including Saudi Arabia, the UAE, Kuwait, Libya, Iraq, Qatar, Algeria, Bahrain, Egypt and Syria. It was set up in 1975 to extend financial support to Arab countries in the energy sector. 

Recently, the lender increased its callable capital to US$8.5bn from US$1bn to boost investments in the energy sector. It also increased its authorised capital to US$20bn, from US$2.4bn previously, and its subscribed capital to US$10bn, up from US$2bn. Callable capital is the amount the lender can call from shareholders, but which has not yet been paid. 

“Support for the energy and related sectors, in our member countries and beyond, helps to guarantee energy security and access to finance in these times of crisis. We will be working with other multilateral development banks and financial partners to mobilise funding and mitigate the impact on these countries,” Mr Attiga added. 

In December, Apicorp agreed to two loan facilities worth a combined US$250m with Sonatrach Petroleum Investment Corporation, a subsidiary of Algerian national oil company Sonatrach, to fund the maintenance of its Sonatrach Raffineria Italiana complex in Sicily as well as for the purchase of Saudi Aramco crude. 

Moody’s Investors Service in October upgraded Apicorp’s long-term issuer and senior unsecured rating to Aa2 from Aa3, both of which are high quality and very low credit risk rating categories.  

Recently, Apicorp reported a 17 per cent increase in recurring income to US$112m in 2019, up from US$96m a year earlier. Net profit attributable to shareholders dropped to US$111.6m from US$182.8m, although the prior year figure included an US$86.6m one-off gain from a divestment

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