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$75 mln for EBRD's biggest ever energy-efficiency deal
Loan to help Russian potash producer generate own power
In its largest ever energy-efficiency deal, the European Bank for
Reconstruction and Development is extending a seven-year, $75 million loan to
Russia’s largest potassium producer, Uralkaly. The bulk of this money, $55
million, will be used to build the company’s own power-generating facilities,
thus helping cut production costs as well as greenhouse gas emissions.
The new gas engines to be bought with this loan will be fuelled by natural
gas. This will allow the company to decrease CO2 emissions by more than 35 per
cent, or some 200,000 tonnes a year, and generate cost savings of more than
$10 million a year for the group.
The Bank is taking half of the loan on its own books, with the other half
underwritten by ABN-AMRO under an EBRD A/B loan structure.
This is the first time that the borrower, Uralkaly, has obtained a long-term
loan on any market. Apart from power-generating equipment, the loan will fund
the building of new warehouses and the acquisition of mining equipment and
modern rail cars for potassium transport.
This transaction is a good example of the kind of impact the Bank can make
both in terms of energy efficiency and in giving a company competing on world
markets the long-term finance it needs for important capital investments, said
Noreen Doyle, the EBRD’s First Vice President
As well as becoming one of the first Russian companies to invest in the
construction of its own power units, Uralkaly is committed to adopting an
Environmental Action Plan agreed with the Bank and in keeping with the Bank’s
environmental policies. The power units will produce both electricity and heat.
Uralkaly is the world’s fourth largest producer of potassium fertilisers, a
key ingredient for plant growth, with annual output of over 4 million tonnes.
Around 85 per cent of its production is exported, mainly to China, Brazil and
India. It operates three mines and four enrichment facilities 1,200 km east of
Moscow.
The Dutch government funded an eco-efficiency audit arranged by the EBRD that
helped identify the areas to be covered by the environmental action plan
Uralkaly has agreed to implement.
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