IFC, a member of the World Bank Group, has signed a $378 million financing package with Axion Energy Argentina to help the company expand and upgrade its oil refining capacity and promote Argentina’s transition toward more stringent and environmentally friendly fuel standards.
The financing package consists of an eight-year $78 million loan from IFC and a $300 million loan raised by IFC from several commercial banks and other financial institutions including ICBC, Santander, BBVA, Crédit Agricole and Citibank,with tenors ranging from 5 to 6 years. This financing marks the return to Argentina’s financial markets of long-term syndicated loans from IFC in tenors beyond 5 years.
IFC’s financing will be used for the expansion of Axion’s refinery, located in Campana, Argentina, which will increase its production of refined products, including ultra-low sulfur diesel; reduce its sulfur emissions; and increase access to cleaner fuels by expanding its distribution network. This increased supply will help reduce Argentina’s reliance on imported fuels and expand availability of efficient and cleaner burning types contributing to better air quality.
Adrián Suarez, Axion’s CEO, stated:
”This long term loan is a very important financing source in addition to the investment of more than $600 million that Axion has carried out since 2013. Axion will go on with this strategic expansion aimed to produce clean fuels with the highest quality standards.”
Alzbeta Klein, IFC’s Director for Manufacturing, Agribusiness and Services, commneted:
“Axion’s upgrades and expansion will help Argentina meet its growing energy demands in a more sustainable manner. The mobilization of long-term funding from international banks not only demonstrates Axion’s strong profile in the market, but also demonstrates potential for additional private investment in Argentina.”