Societe Generale awarded Best Islamic Finance Deal of the Year accolade for Jazan Air Separation for Jazan Air Separation Unit financing


Societe Generale has been recognised in The Banker Deal of the Year 2016 awards for its role in the $1.75 billion Islamic financing of the Air Separation Unit at Jazan Economic City in southwest Saudi Arabia

The transaction, the Group’s largest project financing executed in accordance with Shariah regulations, won in this year’s Islamic Finance category for the Middle East. Societe Generale Corporate & Investment Bank acted as Mandated Lead Arranger, Hedge Coordinator, and Hedge Provider for the transaction.

“We’re very pleased to be recognised for our role in this project, which represented yet another milestone for Societe Generale in the Middle East,” said Richad Soundardjee, Societe Generale Chief Executive Officer, Middle East. “The award pays tribute both to our Islamic Finance expertise, as well
as to our strong client franchise in the region. The transaction also serves to reinforce our growth strategy across the Middle East, a region in which we are convinced we can bring our global franchises to meet the long term economic needs.”

The project, which will be the largest air separation unit in the world once it is built, strengthens the Bank’s relationships with two key clients: Saudi Aramco, the sole offtaker of the unit’s nitrogen and oxygen production, and ACWA Holding, which is developing the facility with NYSE-listed Air Products.

Jazan Economic City is being developed by the Saudi state and Saudi Aramco, the country’s oil company, to promote the development of the province with a particular focus on the refinery, the petrochemical industry, the port, power, water and desalination.

Project financing for the Air Separation Unit (ASU) was a flagship transaction for the Middle East and essential for the industrial complex. The ASU will separate atmospheric air into its primary components of nitrogen and oxygen to feed the 3700 megawatts integrated gasification combined cycle power plant and the 400,000 barrels-per-day oil refinery.

The project is the world’s largest 100 percent Islamic project financing to date, following the conventional istisna-ijara and wakala-ijara schemes. The total project cost is about $2.1 billion, of which $1.75 billion is financed by Islamic senior facilities denominated in both Saudi Arabian Riyal and US dollars.

“Judges used a wide range of criteria in selecting the winning deals with a strong emphasis on the degree to which client objectives were met as well as the deal complexity, innovation, speed of execution and pricing performance,” stated The Banker.

Societe Generale is pursuing an ambitious growth strategy for the Middle East translating into allocation of capital and the development of dedicated teams in the region, whose areas of speciality include Structured Financing, Global Market Solutions, Investment Banking, Custody, and Prime Brokerage services.