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Overview

China Construction Bank contributes to $1.65 billion loan facility to J5 Nakilat joint ventures to finance eight 25-year LNG vessel charters for the RasGas III Project

Commitments (Constant USD, 2023)$162,960,608
Commitment Year•2006Country of Activity•QatarDirect Recipient Country of Incorporation•Marshall IslandsOverseas Jurisdiction•Hong Kong (China)Sector•Transport And StorageFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Jan 31, 2006
Last repayment (originally scheduled)
Jan 27, 2021

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

State-owned Commercial Banks

  • China Construction Bank Corporation (CCB)

Cofinancing agencies

Private Sector

  • Bank of Nova Scotia (Scotiabank)
  • Chuo Mitsui Trust and Banking Company, Limited
  • Crédit Agricole Corporate and Investment Bank (CACIB) (Crédit Agricole CIB) (Formerly Calyon) (Formerly Crédit Agricole Indosuez (CAI))
  • Credit Industriel et Commercial (CIC)
  • DNB Bank ASA (formerly DnB NOR ASA)
  • Fortis Bank
  • Intesa Sanpaolo S.P.A. (formerly Cariplo/Banca Intesa/BCI)
  • Mizuho Corporate Bank, Ltd. (MHCB)
  • MUFG Bank, Ltd. (Formerly Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU))
  • SBI Shinsei Bank, Limited
  • Shinkin Central Bank (SCB)
  • Société Générale Corporate and Investment Banking (SGCIB)
  • Sumitomo Mitsui Banking Corporation (SMBC)
  • Sumitomo Trust & Banking Co
  • The Commercial Bank of Qatar (P.S.Q.C.) (CBQ) (The Commercial Bank)

State-owned Banks

  • Arab Banking Corporation (Bank ABC)
  • Bayerische Landesbank (BayernLB)
  • Norddeutsche Landesbank Girozentrale (NORD/LB)

Receiving agencies

Joint Venture/Special Purpose Vehicles

  • Unspecified Special Purpose Vehicle (J5 Nakilat)

Implementing agencies

Private Sector

  • Daewoo Engineering and Construction (DE&C)
  • Hyundai Engineering and Construction Co., Ltd. (HDEC)

Loan description

2006 syndicated $1.65 billion USD loan facility from China Construction Bank to finance eight 25-year LNG vessel charters for the RasGas III Project in Qatar

Interest rate (t₀)•5.26%Interest type•Variable Interest RateLoan tenor•6-month rateMaturity•15 years

Narrative

Full Description

Project narrative

On January 31, 2006, China Construction Bank (CCB), through its Hong Kong branch, contributed an estimated $86.842 million to a $1.65 billion limited recourse loan facility to a shipping consortium, known as J5 Nakilat, to finance 25-year charters on eight (8) Q-Flex LNG tankers, each owned by a separate special purpose vehicles (SPV). The loan, split between eight (8) amortizing facilities to cover each LNG vessel, had a maturity of fifteen (15) years and an interest rate of 45bps (0.45%) plus contemporary LIBOR before completion and 60bps (0.60%) plus contemporary LIBOR post-completion. J5 Nakilat is the designation for a consortium of consisting of Qatar Gas Transport Company (Nakilat) and five (5) Japanese shipping corporations- Mitsui OSK Lines, Nippon Yusen Kabushiki Kaisha, Kawaski Kisen Kaisha, Mitsui & Co., and Iino Kaiun Kaisha. The consortium jointly owns eight (8) Q-Flex LNG tankers through eight (8) SPV corporations incorporated in the Marshall Islands, named J5 Nakilat No.1-8 Ltd. respectively. Ownership of each SPV is split between Nakilat's 40% stake and a 60% stake jointly held by the Japanese corporations. Each vessel was constructed by Hyundai and Daewoo in South Korea and chartered to the RasGas III project for a period of twenty-five (25) years. As of 2018, the charters were still in operation. Nineteen (19) institutions participated in the lending syndicate, which was 25% oversubscribed. DnB ASA acted as mandated lead arranger (MLA), documentation bank, facility agent, account bank, joint bookrunner, underwriter, and security trustee. MUFG Bank (formerly Bank of Tokyo-Mitsubishi (BOTM)) and Societe Generale CIB also acted as mandated lead arrangers (MLAs), joint bookrunners, and underwriters. Sumitomo Mitsui Banking Corporation (SMBC) acted as mandated lead arranger and underwriter. Norddeutsche Landesbank (NORD/LB), Bayerische Landesbank (BayernLB), Mizuho Corporate Bank (MHCB), and Shinsei Bank acted as senior lead arrangers. Sumitomo Trust & Banking and The Commercial Bank of Qatar (P.S.Q.C.) (CBQ) (The Commercial Bank) acted as lead arrangers. Credit Industriel et Commercial (CIC) and Fortis Bank acted as co-arrangers. Intesa Sanpaolo, Calyon, Chuo Mitsui Trust and Banking, The Bank of Nova Scotia (Scotiabank), and Shinkin Central Bank (SCB) acted as lead managers. The Arab Banking Corporation (Bank ABC) and China Construction Bank (CCB) acted as managers.

Staff comments

1. AidData is currently estimating the loan's interest rate (5.254%) through a two-step process. First, as the meaning and dates of implementation of the reported pre and post-completion margin rates (45bps/0.45% and 60bps/0.60%), the margin rate was estimated by finding the average (52.5bps/0.525%) margin rate between the two. Then, this average margin rate (0.525%) was added to the contemporary 6-month LIBOR (4.729%). LIBOR information was taken from this source: https://www.global-rates.com/en/interest-rates/libor/american-dollar/2006.aspx 2. AidData is currently estimating Chinese contributions ($86.842 million) to the lending syndicate by dividing the total amount of financing ($1.65 billion) by the number of known lenders (19).