PSO Approves Rs. 3.15 Billion Loan for Pakistan Refinery Ltd
Pakistan State Oil Company Limited (PSX: PSO) has approved a loan facility of Rs. 3.15 billion for Pakistan Refinery Limited (PSX: PRL) for its FEED payments.
PSO will borrow the amount in Pak Rupees from local banks and extend it as a loan at a market competitive rate, either at the same or higher premium, to PRL, subject to necessary approval from the Securities and Exchange Commission of Pakistan (SECP).
PRL will utilize the borrowed amount in PKR to purchase US dollars through forward or spot contracts to settle final FEED payments.
PSO will have the right of repayment and an option to convert the loan facility into equity after necessary approvals. This option will be utilized if deemed essential for PSO’s long-term interests.
For the purpose of the loan, PSO will have the first Pari-Passu right in the event of PRL’s default in repayment. This provision shall be included in the financing arrangement with PRL.
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