The International Finance Corporation (IFC) is considering financing the continuing operations in Egypt of the hydrocarbon exploration and production branch of the PICO Group, PICO International Petroleum Group (PICO E&P).
PICO E&P is an Egyptian private oil and gas player, which holds assets in Egypt, Romania and Mexico. In Egypt, PICO E&P, directly or through its affiliates, owns interests in six offshore oil and gas assets: Zaafarana, Amal, Gemsa, Geisum and Tawila West, West Tawila Marine and South Ramadan.
In addition, PICO E&P owns interests in five onshore fields, formerly producing oil and gas fields in Romania, and an exploration, development and production service agreement in the Altamira area, Northern Mexico. PICO E&P and the PICO Group are private companies, owned by the Diab family, which has been operating businesses in Egypt for several decades.
IFC proposes to provide an up to US$75 million senior loan, as part of a larger reserve based lending facility of US$250 million, in favor of Cheiron Finance Limited, a wholly owned subsidiary of PICO E&P. The mandated lead arrangers of the facility are HSBC, EBRD and IFC. The loan will be provided in two tranches, a commercial bank tranche of US$100million and an IFC and EBRD tranche of approximately US$150 million, shared 50/50 between the two institutions.
The two assets supporting the investment, Zaafarana and Amal, are located offshore Gulf of Suez, in shallow waters (25 to 50 m deep).