US firm Dow, Saudi Aramco’s partner in the Sadara petrochemicals JV at Jubail, says the partners will shortly begin discussions with lenders to re-profile the venture’s debt. Dow CEO Jim Fitterling told a 4Q19 earnings call on 29 January that “debt re-profiling is a critical next step for Sadara in providing the JV with enhanced financial flexibility. The JV expects these discussions to take place over the course of this year.”
Dow says Sadara’s project finance arrangements end in four weeks, enabling the JV’s guarantees on Sadara debt to be released. Dow president and CFO Howard Ungerleider says the partners do not have enough cash flow to cover the principle debt. Dow put $500mn into the project last year to cover its 35% share of interest expenses. Mr Ungerleider says a further $500mn input is “roughly our expectation” as a precaution for 2020. Dow also reported “restructuring, goodwill impairment and asset-related charges” of $1.733bn in 4Q19 associated with Sadara. (CONTINUED - 195 WORDS)
