Bank of China contributes $300 million USD to a $2.675 billion USD term loan tranche of a $3.275 billion USD syndicated loan to finance KKR and BlackRock's acquisition of a 40% stake in ADNOC Oil Pipelines

Project narrative

On June 27, 2019, financial close was reached on a deal in which a syndicate of 15 banks — including the Bank of China (BOC) — signed a $3.275 billion USD senior syndicated term (loan) facility agreement with Whitesands Pipeline Limited — a Jersey-incorporated special purpose vehicle (SPV) jointly owned by KKR Infrastructure (50% equity stake) and BlackRock Infrastructure (50% equity stake) — to finance its acquisition of a 40% stake in ADNOC Oil Pipelines. The facility carried a maturity period of 23 years and had its final maturity date in 2042. This loan was divided into two tranches: a $2.675 billion USD term loan tranche and a $600 million USD term loan. BOC contributed $300 million USD to the $2.675 billion USD term loan tranche. In addition to BOC, the following lenders contributed the respective amounts to the loan syndicate: BNP Paribas S.A. ($197.23 million USD), CaixaBank, S.A. ($100.00 million USD), Crédit Agricole Group ($100.00 million USD), Korea Development Bank (KDB) ($100.00 million USD), Metropolitan Life Insurance Company (MetLife) ($175.00 million USD), Mizuho Bank ($181.50 million USD), Nomura ($131.52 million USD), Norinchukin Bank ($300.00 million USD), Banco Santander, S.A. ($272.25 million USD), Samba Financial ($250.00 million USD), Sumitomo Mitsui Banking Corporation (SMBC) ($468.00 million USD), and Sumitomo Mitsui Trust Bank Limited (SMTB) ($100.00 million USD). BOC did not contribute the $600 million USD term loan tranche, which was provided by the following lenders: BNP Paribas ($32.5 million USD), KDB ($100.00 million USD), Nissay Asset Management Corporation (NAM) ($185.00 million USD), Norinchukin Bank ($200.00 million USD), Shinsei Bank ($50.00 million USD), and SMBC ($32.50 million USD). The proceeds of the loan were to be used by the borrower acquire a 40% equity stake in a newly-formed SPV, ADNOC Oil Pipelines LLC, for $3.975 billion USD. In February 2019, KKR Infrastructure and BlackRock Infrastructure signed the midstream pipeline infrastructure agreement deal with Abu Dhabi National Oil Company (ADNOC). ADNOC Oil Pipelines LLC would lease ADNOC's rights, titles, and interest in 18 pipelines over a 23-year concession period (a sale-and-leaseback). These pipelines, located in the United Arab Emirates, totaled a length of 750 kilometers and a capacity of 13 million barrels per day. ADNOC Oil Pipelines would have the right to use, manage, and operate the pipelines to transport stabilized crude oil during this period, and would receive a tariff payable by ADNOC for its share of volume of crude and condensate flowing through the pipelines, backed by minimum volume commitments. ADNOC retained sovereignty over the management of the pipelines and received the $4 billion USD upfront. The deal was governed according to the law of the United Arab Emirates. BlackRock and KKR acquired a 40% share in ADNOC Oil Pipelines, while ADNOC held the remaining 60%. The acquisition was completed on June 27, 2019. Later in 2019, Abu Dhabi Retirement Pensions & Benefits Fund (ADRPBF) and GIC, Singapore's sovereign welfare fund, invested into ADNOC Oil Pipelines, leading to a new shareholding pattern: BlackRock and KKR together with 40%, ADRPBF with 3%, GIC with 6%, and ADNOC with 51%.