Majority government-owned Qalhat LNG has successfully repaid its loan facility obligation ahead of schedule in a testament to its strong financial credentials.
The move, underscoring Oman’s increasingly positive economic outlook, is also in line with the government’s efforts to enhancing the investment climate in the Sultanate by encouraging debt payback by public sector enterprises as a signal of their financial robustness.Qalhat LNG, a company operating under Oman LNG, has been able to repay its loans earlier than expected, thereby reducing interest costs and further assuring potential investors about the secure investment climate in the country.
Dr Mohammed bin Hamed al Rumhy, Minister of Oil and Gas, commented, “The voluntary investment prepayment by Qalhat LNG to the lenders reflects great confidence in the Omani economy, and reveals the resilience of the Oil and Gas industry in the Sultanate. The industry demonstrates the healthy investment environment of the country, like other economic industries and sectors.”
The story of Qalhat LNG’s repayment milestones started in 2005 and is one of many great achievements witnessed by the company since then. Firstly, the company completed the establishment of its production facility on time and under budget, adding to the cost savings and improved investment reputation. In the ensuing years, the company began to voluntarily prepay its lenders and help provide investors increased confidence in the financial robustness of Qalhat LNG.
Salim al Aufi, Under-Secretary of the Ministry of Oil and Gas, and Chairman of Qalhat LNG stated: “The achievement of this prepayment is attributed to many success factors that have been associated with Qalhat LNG from its inception. The final achievement was one of several voluntary financial prepayment initiatives by Qalhat LNG to forge a resolute pathway towards paying all debts on time. These milestones were achieved even during financial challenging times amid the recent oil and gas downturn.”
Harib al Kitani, Chief Executive Officer of Oman LNG and Qalhat LNG, remarked: “This achievement is a testament of our commitment to our lenders and has added more confidence to them about our financial robustness, and keen to continue their relationship with Oman. In addition, we also expect to complete repayment of the remaining debt of Oman LNG, also ahead of schedule. This will open a huge opportunity for more projects or expansion of this successful natural gas investment by the Government and other shareholders.”
The final instalment has rendered Qalhat LNG debt-free, managing to repay, in full, its obligations, without default, ahead of the target date. These efforts are aligned in increasing the credibility of the nation in providing the assurance to investors world-wide that Oman is a safe haven for key investments. The efforts simultaneously further help the Government’s ambitions to diversify the country’s economy and meet its 2040 Vision through such healthy investment opportunities.
On September 1, 2013, Oman LNG and Qalhat LNG integrated to form a single operating unit under the name of Oman LNG. The LNG provided by Oman LNG’s facility contributes an estimated three per cent to the world’s LNG trade.
-Oman Daily Observer