Gunvor to raise $500mn credit for Belgian refinery crude oil, feedstock
By JENNY GROSS
LONDON -- Gunvor Group has launched a $500 million credit facility to help finance the purchase of crude oil for its new refinery in Belgium, the group said Wednesday, a sign of its commitment to moving ahead with plans to build its presence in the refining sector.
Cyprus-based Gunvor, one of the world's largest independent traders of commodities, bought the Antwerp refinery from insolvent Swiss-based refiner Petroplus Holdings AG earlier this year.
The trader is also in the process of buying the Ingolstadt plant in Germany - also one of the facilities owned by Petroplus, once Europe's largest independent refiner.
Commodities traders, which once stuck to being pure trading operations, are increasingly integrating trading operations with refining and production to offset the risk of higher oil prices.
Earlier this year, Delta Air Lines agreed to buy a refinery near Philadelphia from ConocoPhillips, becoming the first US carrier to buy a refinery.
Meanwhile, Swiss commodities titan Glencore International is in the midst of seeking shareholder regulatory approval for a merger of equals with Xstrata to create the world's fourth largest diversified miner with a market capitalization of about $58 billion.
"Gunvor is only following in the footsteps of Xstrata," said Andrey Kryuchenkov, vice president of commodities research at VTB Capital.
"You want to capture the whole process and have full control. [Gunvor] will be the ones taking the crude to their refinery so everybody's a winner."
ING and Rabobank are the two bookrunning mandated lead arrangers of the facility, which will be used to finance the purchase of crude oil and feedstock for the refinery.
Gunvor's chief executive, Torbjorn Tornqvist, said in a statement Wednesday that Gunvor's growth strategy is centered upon investment in energy infrastructure that complements its trading.
"The strong interest already shown by large international banks for joining the facility demonstrates confidence in Gunvor's approach."
The Antwerp refinery has a capacity of 105,000 bpd of oil, as well as storage capacity of 1.2 million cubic meters.
The refinery had temporarily closed in January because of Petroplus' financial situation.
Dow Jones Newswires
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