Dubai: The privately owned Dana Gas has picked up a $90 million corporate lending facility from Mashreq Bank, for a one-year term and which can be extended to a further four years if the company wants to.
The credit facility follows Dana Gas’s announcement that it is "exploring financial options to settle its sukuk by the due date". Along with cash reserves, the Mashreq facility will allow full redemption of the sukuk at the maturity date of October 31. The outstanding total for the sukuk is currently $309 million.
The one-year facility is priced at an initial 3 per cent per annum margin over LIBOR (London inter-bank offered rate). It will be repaid when the planned sale of Dana Gas’s Egyptian assets is completed.
Dr. Patrick Allman-Ward, CEO of Dana Gas, said: “This facility is testament to Dana Gas’s financial and operational strength despite the challenging market conditions brought about by the global health pandemic and its negative impact on the global economy and oil and gas prices."
In a statement, Ahmed Abdelaal, Group CEO of Mashreq Bank said: “ Mashreq aims to offer innovative financing solutions to its partners and clients, and we are delighted to extend this credit facility to Dana Gas, which is the Middle East’s largest regional private sector natural gas company."