View PDF Edition - Islamic Finance News
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deals of the year<br />
case study<br />
ITFC’s financing crude oil in Morocco<br />
Africa Deal of the Year<br />
Morocco is almost entirely dependent on fossil fuel<br />
imports, which account for about 94% of total primary<br />
energy consumption. The energy import bill exceeded US$7<br />
billion in 2010 with a significant impact on the country’s<br />
budget because of the increase of oil and coal prices in<br />
recent years. By financing SAMIR’s imports of crude oil,<br />
the International <strong>Islamic</strong> Trade <strong>Finance</strong> Corporation (ITFC)<br />
supported Morocco in fulfilling its energy requirements<br />
and ensuring a sustainable supply.<br />
SAMIR, the beneficiary, is the sole refinery in the country:<br />
covering 80% of Morocco’s needs of petroleum products.<br />
SAMIR just ended an upgrade project of US$1.2 billion which<br />
lasted three years. On one hand the upgrade enabled SAMIR<br />
to increase its refining capacity. On the other, it enabled the<br />
refinery to produce high quality products with better margins<br />
(Gasoil 50 ppm for instance instead of Gasoil 10000ppm). By<br />
extending this financing at this critical time, ITFC contributed<br />
indirectly to:<br />
Summary of terms & conditions<br />
Instrument<br />
Syndicated structured Murabahah<br />
financing<br />
Issuer<br />
Issuer principal<br />
activities<br />
Issue size & pricing<br />
Date Issuances 9 th April 2012<br />
Arranger<br />
Legal counsel for<br />
issuer<br />
Shariah advisor<br />
Purpose of issue<br />
ITFC, member of the IDB Group<br />
Shariah compliant trade finance<br />
US$200 million on a three-month<br />
revolving basis<br />
International <strong>Islamic</strong> Trade <strong>Finance</strong><br />
Corporation (ITFC)<br />
IDB legal department<br />
IDB legal department<br />
To finance SAMIR’s crude oil needs,<br />
therefore to contribute to the sustainable<br />
supply of petroleum products in Morocco<br />
Deal Mechanics: Transaction Flow<br />
5.2<br />
Release is made<br />
4<br />
Oil stored<br />
1<br />
Supply contract<br />
2<br />
20% Payment<br />
5.1<br />
Repayment<br />
is made<br />
Supplier<br />
3<br />
100% Payment<br />
Disbursement & Repayment steps:<br />
1. SAMIR signs supply contract with its supplier<br />
2. SAMIR pays 20% of contract value as a prior deposit to ITFC<br />
3. ITFC pays 100% of contract value to the supplier after shipping doc. are presented<br />
4. Oil stored under supervision and control of collateral manager (ACE)<br />
5. ITFC sends release instruction to ACE after SAMIR pays the outstanding balance<br />
30 March 2013
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